Luxury and contemporary labels alike are flocking to London’s tony Brompton Cross area, opening stores in the pretty South Kensington neighborhood to cater to its affluent, often international residents.
This story first appeared in the May 19, 2014 issue of WWD. Subscribe Today.
Over the past year, 3.1 Phillip Lim, Acne and Carven all bowed on Pelham Street in the area, while J. Crew opened on Draycott Avenue. They join Stella McCartney, who opened a store there in 2012, and longer-term residents like Chanel on Brompton Road and Joseph on the area’s Fulham Road.
Natalie Lintott, a partner in central London retail at global real estate adviser Cushman & Wakefield, said she believes retailers are turning to the area partly as the competition for locations in London’s established luxury destinations of Bond and Sloane Streets has become so fierce.
“I think we’ve got about 12 retailers bidding on every store that becomes available on Bond Street and Sloane Street at the moment,” said Lintott. As a result, Lintott said, new “pockets” of luxury retail are emerging in London to cater to that demand, of which Brompton Cross is one.
In addition, the Brompton Cross area is far more affordable in terms of rents, Lintott said. While prices for zone A rents on Bond Street stand at 1,250 pounds, or $2,080, a square foot, doubling in the past five years, rents in the Brompton Cross area are around 400 pounds, or $665, a square foot for zone A, up from 200 pounds, or $333, a square foot three years ago.
And the costs involved with key money — a one-time payment to an existing tenant — are also less weighty in the area. While key money on Bond Street can involve sums in the tens of millions of pounds, Lintott said, the figures in the Brompton Cross area are around 100,000 pounds, or $167,000.
“Brompton Cross really is a much more exciting opportunity in terms of affordability compared to these other [London] locations,” Lintott said. She pointed to the French contemporary label Iro, which will open a 1,500-square-foot store there this summer.
But aside from the attractive economics, the well-heeled residents who shop in the area are also part of the neighborhood’s attraction for fashion labels. “It’s more of a discerning, London shopper,” said Lintott.
Jenna Lyons, J. Crew Group Inc.’s president and creative director, said this month that with its Draycott Avenue store, the label is “really nurturing the Brompton client, which is a local one,” she said. “There is an appetite for the brand there — [customers] were calling the store to see when the Sophia Webster shoes [in collaboration with J. Crew] were arriving.”
Lyons said about 50 percent of the product in J. Crew’s 3,500-square-foot Women’s Collection store “won’t be on Regent Street,” the label’s London flagship.
“This store feels more neighborhood-y, and is about finding jewel-box things and special items,” such as a double-face cashmere coat, and navy jacket with gold bullion embroidery, she added.
And when McCartney, the first of the new generation of retailers to move to the area, opened her Fulham Road store in 2012, she clearly had a vision for the future, describing the area as “such an exciting location.”
“It is residential and has tons of life buzzing around, which a Stella McCartney girl is all about,” she told WWD at the time.
Lintott also noted that as much of the area is owned by established estates like the Wellcome Trust, Brompton Estates and Tribeca Holdings, the “aspirational” tenant mix is tightly controlled. She contrasted that to certain areas of Oxford Street, where much of the real estate is owned by individual landlords, who will simply offer leases to the highest bidder.
And Lintott believes that as London retail real estate is increasingly in demand, since the city is seen as a “gateway city” targeting a global customer, the Brompton Cross area will similarly remain a desirable spot.
“Only time will tell,” she said, “but we can’t foresee any diminished interest.”