London luxury retailers buying stores to avoid rent hikes

Luxury retailers in London are avoiding the spiralling rental prices by buying their own shops, with around 70 percent of property sold on London’s Bond Street being purchased by retailers so they don’t lose out on prime London selling locations.

According to new research by commercial property adviser Cushman and Wakefield, compiled exclusively for The Independent, nearly half of the 80 properties on Bond Street were owned by the stores themselves as of last year.

The report reveals that last year Richemont, which owns Cartier among others, teamed up with developer Oxford Properties to buy five Bond Street properties for around 300 million pounds, while in April its believed that Spanish billionaire Amancio Ortega’s investment company, Ponte Gadea, paid over 400 million pounds for a stretch on Oxford Street.

Fergus Keane, senior director at Cushman and Wakefield’s West End team told the newspaper that buying is increasingly regarded as safer than renting in London.

“Landlords know that there is so much competition for prime space that they can charge almost what they like. They know how important London flagships are for these retailers,” he said.

Keane added: “This has driven the retailers themselves, including some of the biggest luxury names in the world, to try and buy buildings for their own occupation, particularly in the West End where they can control their destiny and image for the long term.”