International retailers renew their interest in Ireland at Cannes show
INTERNATIONAL retailers and investors are showing increased interest in the Irish retail market, according to Irish estate agents who attended MAPIC, the world's largest retail real estate conference and exhibition which took place in Cannes.
The four Irish agencies who had representatives at the show are expecting to attract international retail brands and investors to shopping centres and high streets here on the back of increased activity by international chain stores as well as the improving outlook for the domestic economy.
More than 8,400 delegates attended MAPIC this year, including 1,400 retail brands of which about 350 were new retail brands seeking to entice good deals from landlords and agents. France topped the number of exhibitors and there were 83 from the UK and 82 from Belgium.
Nearly 70 countries were represented, including developers from China, India, Russia and Brazil. Larry Brennan, chairman of Savills Ireland who has been attending the exhibition for almost 20 years, is hopeful that some of the recent brands that have arrived in the UK from the US and Australia will extend their expansions into Dublin and other major Irish urban centres.
"Unlike previous years, where some international retailers were trying to avoid Irish agents, this year some of them were genuinely willing to engage and wished to know more about the Irish recovery story. They also recognised that the worst phase of the Irish trading cycle may be over," he explains.
Their interest was also helped by the fall in Irish retail rents from their exalted highs as some of the most expensive in Europe.
"Now that we are in the bottom third (of the retail rents table), international retailers are being attracted by the better value that's available here" he said.
When it comes to trying to persuade retail chains to sign a lease, there's no prize for being the most expensive location in Europe.
For Irish agency GVA Donal O Buachalla, not alone was it the first time at the show, it was also the first time that their international associate GVA Worldwide took a stand there.
Lisa McInerney represented Ireland on the GVA stand and was glad to find a number of investors looking to invest in single-tenanted high street Irish retail outlets with good tenants.
"Before MAPIC, most of the enquiries I've received have come for office and multi-home investments so it was good to see that investor interest is also extending to retail. Yields of 7-8pc are also a help as (such properties) offer the prospect of better returns than are available in the UK. I met at least five clients with requirements to invest between €5m and €10m in outlets and I'm hoping to follow up on that. However, one of the problems is a lack of good stock," she said.
She also reported how some of the bigger brands have become more interested in Ireland because of the keener rents which make Ireland look like good value.
Among the US retailers on the expansion trail and who may include Ireland is Victoria's Secret, which the 'New York Times' credited with "pioneering underwear as fashion". While it has already opened a store at Dublin Airport, this is only accessible to travellers who are flying out of the airport. It is expected to add five or six more shops next year in the UK following its recent opening of both a Victoria's Secret and a Pink store at Bluewater shopping centre in Kent in the UK.
The UK property trade was abuzz at MAPIC over speculation that the lingerie giant plans to open up to 50 full-sized stores and that its owner, Limited Brands, could bring other formats to the UK market including Bath & Body Works. Irish agents are hopeful that this may also include Dublin.
Among the other US chains that estate agents are hoping may also come here is US fashion chain J Crew, which recently opened a store in London's Regent Street, and a small menswear shop in Lamb's Conduit Street, Bloomsbury, London, and it plans to open a women's wear boutique in Brompton Cross, west London.
Other US retailers reported to be planning to move into the UK, and hopefully Dublin, are American Eagle which is expected to take space at the Westfield shopping centres in Stratford and White City London.
Williams-Sonoma is set to open a branch of its West Elm chain of modern furniture and home accessories in Tottenham Court Road, in the West End next month. The retailer is thought to be looking for at least five more stores in London and could also launch its Pottery Barn format next year.
Some British chains also have expansion plans. For instance a new chain of fast beauty salons, called Blow, has announced plans to open 100 branches.
Nor are the expansion plans confined to fashion. The British-based Eclectic Bar Group, which targets cities with large student numbers, aims to have up to 50 outlets in the UK over the next decade – up from 20 currently.
Harrods Group, owned by Qatar Holding, is looking at expanding its 10-strong chain of tearooms. The company has spent £200m refitting departments and opening boutiques in airports since Qatar Holding bought it three years ago.