Upmarket streetwear vies with traditional luxury retail for prime Orchard Road frontage
By Timothy Tay
/ EdgeProp Singapore |
A slew of new flagship store openings has crowned the retail market this year. (Picture: Albert Chua/ The Edge Singapore)
SINGAPORE (EDGEPROP) - The relatively strong showing in the retail real estate market in 2022 has been due to confidence among retailers that the local retail market would be able to successfully ride a recovery after having experienced the worst of the Covid-19 pandemic.
According to Sulian Tan-Wijaya, executive director of retail and lifestyle at Savills Singapore, a handful of luxury retail segments has benefitted the most from the recovery in consumer spending this year. She has been at the forefront of the retail property market since 2008 and has observed the changing trends across the retail and lifestyle sectors.
“Luxury watches, luxury fashion, athleisure and streetwear are among the biggest beneficiaries in retail spending this year. These sectors performed very well during the first two years of the pandemic [from 2020 to 2021] and continue to see strong growth after markets started re-opening [this year],” she says.
Top-tier brands such as Rolex, Chanel, Hermes and Louis Vuitton are largely inflation- and recession-proof, says Tan-Wijaya. She adds that this group of high-income buyers “are not price-sensitive unless they are entry-level buyers”.
A slew of new flagship store openings has crowned the retail market this year. According to Tan-Wijaya, the most notable and prominent ones are those that unveiled street-front stores along Orchard Road and Scotts Road. These are the most prime shopping areas in the Central Area.
Tan-Wijaya singles out Korean streetwear MLB, Japanese brand SNKRDunk, streetwear brand Stussy and American apparel Carhartt as particularly noteworthy new-to-market brands this year. “This is a testament to street fashion taking the fashion world by storm and taking over retail spaces traditionally occupied by established fashion brands,” she says.
Tan-Wijaya: Luxury watches, luxury fashion, athleisure and streetwear are among the biggest beneficiaries in retail spending this year. (Picture: Savills Singapore)
Besides major streetwear apparel brands, many beauty brands like Dior, The History of Whoo, Su:m37 and Guerlain also opened new stores. Several luxury boutiques including Dior and Fendi also underwent major renovations this year. “These are signs indicative of strong consumer demand in these sectors,” says Tan-Wijaya.
She adds that between 2020 and 2021, many retailers either closed their stores or reduced their store count as consumer spending took a dip. “However, luxury brands generally bucked this trend by either expanding their store sizes or undergoing renovations,” she says.
Before safe management measures were gradually eased in 1Q2022, luxury boutiques like Chanel, Louis Vuitton and Dior started to attract long queues of shoppers waiting to enter. “Customers queueing comprise mainly Millennials and Gen Z, who seek luxury for their individual expressions, social status and aspirations,” says Tan-Wijaya.
In addition, “revenge spending” on the part of most consumers who had been mostly confined to their homes over the past two years also played a role in this growth and demand for luxury products, she says.
Despite recessionary fears erupting in 2023, luxury boutiques will continue to dominate prime and ground-floor street-front spaces in upmarket shopping malls in Singapore. However, the next few years could see a variety of new retail concepts gradually take over spaces that were traditionally occupied by fast fashion brands, opines Tan-Wijaya.
A case in point is homegrown furniture retailer Castlery, which took over the 24,000 sq ft space at Liat Towers that was vacated by fashion brand Zara. Tan-Wijaya and Savills Singapore brokered this retail space deal for Castlery.
Competition is expected to rise as more brands look to open flagship spaces in Singapore next year. “These retailers all want their stores to have prominent Orchard Road frontage, which is very scarce since most incumbents would not want to give up such precious spaces in prime shopping zones,” says Tan-Wijaya.
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