Fashion accounts for nearly 40% of newly rented retail space in Europe in H1

In H1 2024, rental activity for retail spaces in Europe was on par with 2023, according to the ‘Retail Radar’ report by real estate services firm Cushman & Wakefield. The report, based on 900 transactions that occurred during the first six months of the year, indicated that nearly a third of these deals were for fashion stores, accounting for nearly 40% of newly rented space. Fashion was in fact the most active sector, ahead of catering and health & beauty.

British group JD Sports, Italian group Calzedonia (owner among others of Calzedonia, Tezenis, and Intimissimi) and Spanish group Inditex (owner among others of Zara, Bershka, and Oysho) were among the most active fashion retailers in Europe in this respect. However, though fashion was the most dynamic sector rental-wise in H1, the area of new retail spaces rented by fashion groups was down 13% compared to a year ago.

The report also found that luggage retailers played a leading role, their growth bolstered by the global tourism industry’s recovery. Brands like Tumi, Delsey and Carl Friedrik all expanded their retail network. “The latter are planning to expand further, judging by the fact that their footfall forecasts for 2024 are said to be exceeding pre-pandemic levels for the first time,” said Cushman & Wakefield.

The mass market segment accounted for the lion’s share of the 900 deals monitored by the report, with 70% of the number of transactions and of rented space, while the premium sector (whose rented space fell by 50%) and the luxury sector (down 40% for number of transactions) were far less buoyant.

In terms of store size, most of the transactions concerned smaller stores, retail units of less than 200 square metres. Rental costs remained stable or increased, according to the report, but remained on average below their pre-pandemic levels.

In France, the rental market was boosted between January and June 2024 “by the Olympic Games effect,” which is set to “benefit the entire sector from 2025, and partially offset the macroeconomic issues looming on the horizon,” said Christian Dubois, head of retail services at Cushman & Wakefield France. The sports, travel goods and leather goods sectors are expected to thrive.