For the first time in history, a European shopping street has claimed the title of the world’s most expensive retail location. Milan’s prestigious Via Montenapoleone has topped the global ranking of Cushman & Wakefield’s “Main Streets Across the World” report for 2024, dethroning New York’s iconic Upper 5th Avenue. Via Montenapoleone now boasts an annual prime rent of €20,000 per square meter, marking an 11% increase from the previous year.

This milestone highlights the growing significance of Europe’s luxury retail sector, where high-end brands continue to flock to renowned shopping destinations, using physical stores as showcases for their exclusivity and as extensions of their brand identity.

Global Rankings See Major Shifts

According to the 34th edition of Cushman & Wakefield’s report, Via Montenapoleone’s rise has pushed Upper 5th Avenue in New York to second place, with rents stable at €19,537 per square meter annually. London’s New Bond Street claimed third position, reporting a significant 13% increase in rents to €17,210 per square meter, surpassing Hong Kong’s Tsim Sha Tsui, which dropped to fourth place with €15,697 per square meter. Paris’ Avenue des Champs-Élysées rounds out the top five, maintaining its position with a 10% rent increase to €12,519 per square meter.

The report reveals that rents rose in 79 of the 138 retail streets analyzed globally, with the United States seeing the most robust growth, while European hotspots like Italy, France, and the UK also recorded notable increases due to sustained demand for luxury retail space.

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Europe’s Leading Streets: Solid Growth and Stability

Beyond Via Montenapoleone’s historic achievement, European cities remain prominent in the rankings. London’s New Bond Street, Paris’ Champs-Élysées, Zurich’s Bahnhofstrasse (7th place), and Vienna’s Kohlmarkt (10th place) all secured spots in the global top 10. Germany’s best-performing retail street, Munich’s Kaufinger/Neuhauser Strasse, ranked 24th globally, maintaining a stable annual rent of €3,840 per square meter.

“Despite challenging market conditions and the dynamic growth of e-commerce, the demand for physical retail space in prime locations remains unbroken,” said Andreas Siebert, Head of Retail Investment Germany at Cushman & Wakefield. “These internationally renowned streets offer brands a unique opportunity to enhance their visibility and create bespoke customer experiences.”

Germany, while not experiencing dramatic rent increases, remains a consistent player in the European retail market. Key cities like Munich, Berlin, Hamburg, and Düsseldorf continue to show stable demand for prime retail spaces, reinforcing their position as reliable destinations in the European retail landscape.

Luxury Retail Thrives Amid Shifting Market Dynamics

The demand for physical retail stores remains strong, particularly in the luxury sector, where prime locations act as a platform for both branding and customer engagement. Cushman & Wakefield emphasizes the role of these streets as “showrooms” for luxury and mass-market brands alike, catering to shoppers who seek exclusive, in-person experiences that e-commerce cannot replicate.

A Global Perspective on Retail Trends

The report also highlights regional trends. North America experienced the fastest rental growth, with an 8.5% increase, driven by strong economic performance and rising demand in high-traffic areas. Europe and the Asia-Pacific region followed, with growth rates of 3.5% and 3.1%, respectively. Globally, retail rents have surpassed pre-pandemic levels, with an average increase of 6% over 2023 figures.

Looking Ahead

The Main Streets Across the World report underscores the enduring value of physical retail spaces, particularly in iconic shopping streets that attract global luxury brands and discerning consumers. While competition for prime locations continues to drive rents higher, stability in regions like Germany demonstrates the resilience of established markets.

Cushman & Wakefield’s findings provide valuable insights into the evolving landscape of global retail, reaffirming the critical role of luxury and high-street destinations in fostering economic growth and enhancing brand visibility in an increasingly digital world.