Top of the market?

In the past month my colleague Nicola Harrison has revealed two big deals on Regent Street - first Hollister taking over the National Geographic store, then last week the news that Supergroup has done a deal to replace Austin Reed in its well-known store, with Austin Reed in turn likely to take over Aquascutum’s lease on a smaller store on the street.

For Regent Street as a retail destination the deals are fantastic, and will turn the bottom end of the street into a real mecca for younger shoppers. While the top end of the street has been transformed with a series of deals over the past five years, the Picadilly end of the street has lost out with rather peculiar stores like The Sting and National Geographic moving in.

While those with a sense of nostalgia will be sorry to see the Austin Reed store go, it has been rattling around in the space for years. A move will give it the opportunity to have more appropriate space for its needs and to adapt its offer for today’s customer.

Hollister and Superdry have proved guaranteed footfall drivers in shopping centres up and down the country, and there’s no reason why Regent Street will be any different. But talk of a £10m premium being paid for the Austin Reed store will make seasoned observers nervous. With the rent on the site over £2m too, Superdry will have to sell a lot of hoodies to make the sums pay.

The truth is though that the West End property market is unique and operates outside the norms affecting all the rest of the UK’s property market. Eyebrows will be raised by deals like the Superdry one, and Forever 21’s hefty premium for the HMV site on Oxford Street, but the truth is these deals are a function of the market, and the West End’s unique appeal to both UK and overseas shopppers make it somewhere where retailers from around the world need to be. It’s a bubble which isn’t going to burst any time soon - not every retailer is going to make it work, but there’ll be plenty of others waiting to take their place if they don’t