European Luxury Retailer Openings Jump 77% as China Sees ‘Softening’

Luxury store openings in Europe skyrocketed last year as global travel resumed.

That’s according to the latest edition of Savills’ Global Luxury Retail Outlook, which found a 77% increase in new high-end stores in Europe.

“A relatively fast recovery in luxury spend in the region, helped in part by the return of international visitors no doubt moved Europe back up the agenda for expanding luxury brands,” the report by the real estate agent said.

Overall, Europe’s luxury store openings accounted for 23% of all such store openings worldwide, the report said.

The report comes on the heels of news last month that luxury retailer LVMH — owner of Louis Vuitton and other brands — had reached a key milestone: Its market value topped $500 million, a first for European companies.

Also progressing was the Middle East, which began a growth trend in 2021 when “luxury brands refocused on relatively underserved affluent markets in the face of reduced international travel,” Savills said.

The Middle East’s share of global new store openings doubled to 6% last year, with most of these openings happening in Dubai and Saudi Arabia, the report said.

The report noted that these regions benefited from a “marginal softening” in new store openings in China due to COVID restrictions.

China accounted for 41% of global new openings as brands continued to focus on that country’s large luxury market, Savills said.

“But, in quantum terms, we did see a decline in new openings,” the report said. “This was not wholly unexpected considering the acceleration in openings the year before and the weakening in occupier confidence in the face of the rolling lockdowns seen in some parts of China throughout 2022.”

Meanwhile, PYMNTS reported in April that luxury brands are promoting exclusivity to focus on and engage with their core customers. Taking a cue from iconic brands like Hermès, retailers such as Saks and Gucci have begun efforts that cater to their top clients.

And Gucci last month opened a new Gucci Salon store in Los Angeles exclusively for its VIP clients and Hollywood A-listers.

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