“This is also set to happen in Brisbane as retailers look to take a bigger bite out of the future Olympic city, with additional stores in Queens Wharf Brisbane, which is due for completion in 2023.”
”Luxury retail continues to perform extremely well in Australia, with many retailers seeing growth well exceeding pre-pandemic levels, with luxury spending expected to grow by more than 5.42 per cent annually through to 2027.“
Dexus has led the charge with the new brands at its 25 Martin Place, formerly the MLC Centre, with the opening of exclusive labels, including Valentino, as part of the centre’s $170 million transformation.
Valentino Castlereagh, the brand’s first flagship boutique within South East Asia, opened in November and the 617 square metre store, is a strategic location that marks an important step forward in the brand’s brick and mortar and network expansion strategy.
The new Valentino store at 25 Martin Place, Sydney, owned by Dexus
The head of transactions and development – retail, healthcare and alternates at Dexus, Amanda Pieriboni said 25 Martin Place had some of the first luxury retail in Sydney, adding that luxury retailing is a “whole of precinct experience”.
“It’s an evolving story, about breathing new life into Sydney’s luxury core by adding new offers to the mix,” Pieriboni said.
“The appetite is still there for international brands. What has traditionally driven this expansion of luxury retail is the tourism market, especially international tourists.”
The Graaf group, run by Gennaro Autore, is behind the labels of Missoni and Brunello Cucinelli that will join Valentino at 25 Martin Place, on the corner of Castlereagh and King Streets, and it has plans to bring more into the country.
“The aim for the luxury brands is to have a physical presence,” he told industry magazine Ragtrader. “All the luxury brands and clients, the target market loves the traditional shopping experiences.
Loading
“So what our aim or objective is, is to definitely create proper location focusing on the traditional experience in store, while of course having a digital platform for the online sales.”
Graaf Group is a family-owned group of companies active in real estate, luxury fashion, hospitality, interiors and architecture design services, and media.
“Right now, there is minimal availability of sites that are suitable for certain brands,” Autore said to the Ragtrader “But we are in continuous negotiation. We have other brands coming up regarding fashion, but we have secured brands in another arm of the business which is more to do with hospitality.”
Colliers director for retail leasing Michael Tuck said strong demand from luxury brands seeking new Sydney CBD flagships or upgrades of existing store sizes and locations, and the longer 10-15 year lease terms secured by these brands, has ensured limited vacancy will likely drive rent increases for premium assets.”
“Following completion of 39 Martin place, 388 George St, 25 Martin Place and 77 Market Street, limited opportunities for new luxury and premium store developments in Sydney’s CBD will ensure rare leasing opportunities are coveted for several years,” Tuck said
“Melbourne’s CBD is also a tightly held luxury market due to limited supply, although premium tenants will likely benefit from the regentrification of Bourke Street Mall.”
He said the growth of luxury retail down under is driving the flight to quality and a two-tiered retail market, seeing assets which offer enhanced consumer experiences in prime positions taking the lead on COVID recovery.
Cushman and Wakefield’s report on the most expensive retail strips in the world, says during the pandemic, demand for luxury initially fell in line with other segments of retail. Prominent brands took the opportunity to retrench staff, spending the time improving their online experience and keeping relations with customers strong.
However, things have worked out quite nicely for the high-end retail brands.
Loading
“Since then, the luxury goods market has rebounded strongly, and in many instances, some retailers find themselves in a better position than they were in pre-pandemic. Sales per quarter for the major luxury conglomerates such Hermes, LVMH, and Richemont have all increased by over 20 per cent since the
end of 2019,” the report says.
The inflationary pressures, expected to take hold more firmly in the new year, have so far barely dented the budgets of affluent
Australian households. Despite spikes in prices of energy, food and housing, affluent shoppers continue to seek out luxury retail, giving upmarket brands a buffer even in the face of economic challenges.
