The Quarter is becoming a haven for high net worth international shoppers across Mayfair, Piccadilly and St James’s.
With an estimated 80% of total UK spend on jewellery and watches taking place in London, the new report from the London Luxury Quarter reveals at least half of this figure stems from sales within the London Luxury Quarter itself. With the area encompassing 90 jewellers (95,000 sq ft in total) and 89 art galleries (165,000 sq ft in total), the report reveals the London Luxury Quarter has remained resilient in the face of a global recession.
“The last five years has seen the interplay between art and jewellery formally recognised as the most enduring and appealing proposition of the area for brands and investors alike. You only need to look to the number of New York galleries upping their presence in the area as a sign that the London Luxury Quarter is now seen by the industry and buyers as the art and jewellery epicentre of the world. For as long as the Quarter is home to the most coveted watches, jewellery and art, the area will continue to set itself apart from other luxury districts in attracting both the high net worth shopper and investor,” says Mark Henderson, Chairman, London Luxury Quarter.
Record breaking sales across art and jewellery have been the overarching story across the Quarter during the past five years. Standout sales include Claude Monet’s Le Bassin aux Nympheas which Christies sold for £40.9 million in 2008. More recently Christie’s has benefited from rising spend on art from the new generation of high net worth Chinese investors responsible for driving sales up 9% to £2.4 billion so far in 2013 in seeking timeless investments over material purchases in their quest for luxury acquisition. Furthermore, in 2010 Sotheby’s saw a Cartier Panther bracelet fetch £4.5 million in their Bond Street sale room – it remains the most expensive bracelet ever sold at auction.
“The London Luxury Quarter is the most important market for jewellery and art in Europe. At Sotheby’s on Bond Street I joke that I worry about our carpet. Massive amounts of people come through during the big sales. The Sotheby’s café on Bond Street has queues and we’re not even in the restaurant business,” says Patti Wong, chairman of Sotheby’s Asia and international socialite.
LONDON LUXURY QUARTER GEARS UP FOR EXPANSION
With the advent of Crossrail set to increase daily visitors from Bond Street from 155,000 to 220,000 property owners are fiercely pouring investment into the area to ensure little is left to chance in creating a high density haven of diverse luxury retail. The Bond Street Development Group are leading the way with an ambitious five year plan set to span concierge services and the creation of an enhanced aspirational environment in addition to the recent launch of the Bond Street Beadles providing a multi-lingual welcome to international shoppers from across the globe.
Property owners are also following suit with Grosvenor investing £80 million in the refurbishment of Mount Street and over £10 million spent to date on public real works in North Mayfair. Work is already underway in St James’s following a £500 million investment from The Crown Estate as part of a 10 year plan to position the area as a global leader in fine art and antiques. With a rising premium placed for prime gallery space in the Quarter, the Pollen Estate is set to create five new locations on Cork Street in addition to a series of redevelopments in order to keep up with demand as the ripple effect from competition for space on Bond Street continues to increase the desirability for peripheral locations.
In tandem with development and investment across the Quarter, brands are increasingly safeguarding their position and keeping ahead of the competition in purchasing their premises. Across the Quarter rents face upward pressure with Bond Street alone witnessing an increase in rent of 40% over the last 18 months according to London retail agency Jones Lang LaSalle.
Knight Frank predicts further rent increases are on the horizon as New York’s most important galleries install themselves in the London Luxury Quarter with global art world power player Larry Gagosian paving the way with its first London gallery in 2000. Contracts are currently being exchanged with Grosvenor for Gagosian to extend their presence in the Quarter with a view to open a new gallery at 20 Grosvenor Hill. Brands who have recently bought properties include Prada on Bond Street, who paid £87.5 million and LVMH who bought the Louis Vuitton Bond Street flagship store and shops leased to Coach and Smythson for approximately £292 million.
“There’s always a trade-off between space and location. The rents here aren’t for the fainthearted, but even galleries who moved East for the space are moving back to the London Luxury Quarter, because ultimately, location wins every time,” says Andrew Renton, Director, Marlborough Contemporary.
“The global luxury marketplace remains increasingly competitive with retailers and businesses setting the destiny of luxury districts. Bond Street is the spine of the London Luxury Quarter with the concentration of art galleries and jewellers a pivotal and vital driving force that makes it a unique marketplace. Our 5 year plan is robust and will ensure Bond Street is perceived unequivocally as the prime trading space for the world’s leading luxury brands,” says Beverley Aspinall, Managing Director, Bond Street Development Group.
“St James’s has for a long time been a global leader in the fine art and antique trade. We are keen to preserve and enhance this important part of the area’s unique cultural heritage as we continue to progress our ten year, £500m investment strategy,” says James Cooksey, Head of The Crown Estate’s St James’s Portfolio.