Retail rents suffer biggest fall in 24 years

More than half the world's most expensive shopping streets have seen prime rents slump in 2009, marking the biggest fall in retail rents in 24 years, data from real estate advisor Cushman and Wakefield showed.

New York's Fifth Avenue remained the world's most expensive street, though rents dropped 8.1 per cent to $1,700 (Dh6,239) per square foot per year, Cushman and Wakefield said.

It was followed by Hong Kong's Causeway Bay with a 15.1 per cent fall to $1,525 per square foot per year, while rents in Paris' Avenue des Champs Elysees were static at $1,009, the survey of 274 main streets across 60 countries showed.

Cushman and Wakefield's global head of retail, John Strachan, said the past year was one of the most difficult for the sector, with consumer spending and retail sales down in many markets.

"The good news, however, is that the worst is almost certainly now behind us," Strachan said in a statement, adding the annual survey's findings represented the biggest global fall in retail rents in its 24-year history.

"There will undoubtedly be some markets which will continue to be affected over the next year but we expect to see a greater number move back into positive territory," he said.

By region, the average rent across Europe was $235 per square foot per year, followed by Asia Pacific at $234 and the Americas at $193. On average, rents fell 15.1 per cent in Asia Pacific and 5.8 per cent across Europe, but rose 0.3 per cent in the Americas.

Globally, the biggest fall in rents was in Mumbai, with the Colaba Causeway down 63.5 per cent. Europe's biggest faller was Bucharest's Calea Victoriei, down 48.1 per cent.

On the upside, in Sao Paulo, Brazil, prime rents rose 111 per cent at the Alameda Lorena. In Europe, the biggest gainer was Bordeaux's Rue St Catherine, up 17.6 per cent.

The average rent across the 274 main street locations was $213 per square foot.

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