MR 2018

49

Copenhagen Property Market Report 2018

LOCATIONS Retail Read more

International shopping and tourist destination

Copenhagen offers both domestic and international brands, highly acclaimed restaurants and a trendy metropolitan setting. Due to strong demand for prime high-street locations, virtually all retail units with flagship qualities were snapped up in 2015-2017.

A booming tourist industry, growing consumer confidence and a general shift in consumer patterns have served to consolidate Copenhagen’s position as an attractive and international shopping destination. Featuring a popular and well-developed high- street market, a flourishing restaurant scene, well-established shopping centres and a broad range of traditional retailers, Copenhagen today offers both domestic and international brands, highly acclaimed restaurants and a trendy metropolitan setting. The retail composition of many Copenhagen districts has changed markedly in recent years, driven by a shift in consumer patterns and demographics as well as the continued influence of new trends. These drivers, including a growing tourist industry, the advance of e-commerce, a shift in consumer spending in favour of leisure- and luxury-related spending as well as increased focus on the shopping experience, are expected to continue to define the retail mix in Copenhagen in the next 12 months. Tourism drives high-street luxury brand presence According to Statistics Denmark and World Travel & Tourism Council (WTCC), Copenhagen and Denmark in general have seen a sharp increase in tourism over the past decade, which has translated into an increase in the industry’s overall contribution to Danish GDP. The increase in tourism has affected the Copenhagen high street in particular, with luxury brands greatly strengthening their position with a string of shop openings in 2015-2017, taking advantage of the fact that tourists generally tend to spend more money. As a result, newcomers to the upper end of the high-street market are mainly international luxury brands with a strong emphasis on quality and the shopping experience in general. However, flagship stores of various domestic retail brands remain a prominent feature of the high street with fierce competition for the best locations. Despite the intense competition, the rental growth observed at prime locations in recent years seems to have tapered off as most of the high-end players in the market have already established a presence. Due to the strong demand for shops at prime high-street locations, virtually all retail units with flagship qualities were snapped up in 2015-2017. Bearing in mind the average lease term of a newly signed lease, prospective newcomers to the prime high-street market are left with limited choices in the short to medium term. They have therefore started to zoom in on retail units off the traditional high street. For instance, this spring