A postcard from the far east

34 // Manifesto
For the most luxurious of retail brands, the Far East has
been paved with gold. But are times changing? We asked
Mark Burlton, Cushman & Wakefield’s Head of Cross Border
Retail, for his take on the current shopping mind-set.
[different] Spring 2015
// 35
All around the high-rise glitz and bling of Hong Kong and
Shanghai diamonds are losing their lustre, luxury leather
stores are tightening their belts and the catwalks have
started to go to the dogs. The omnipresent expensive
watch retailers wish they could stop time and the hyper
cars are selecting reverse gear.
Mark Burlton is Head
of Cross Border Retail at
Cushman & Wakefield
The wealthy Chinese are reinventing themselves before
our eyes and switching from revolution to evolution – and
the luxury market isn’t happy. The goose has stopped, or
at least slowed down, laying its golden eggs and it appears
nobody told the retailers in their marble palaces. Add to this
a revised downwards forecast of 7% growth in GDP from the
ruling Communist Party and you get the impression that a
few says forecasts are going to have to be revised, and not
in a good way.
I love Asia in so many ways including its rather brash
five-storey high shop fronts blasting their logos for brands that in
London would be blocked by listed building control, conservation
areas and – dare one say it – more conservative tastes.
But I love the
neon blast
here as the
sun goes down
and shoppers
head out after
work for another
hedonistic binge. I love the sense of pride in what they have
and if I could afford to join them I undoubtedly would.
I love the neon blast here as the sun
goes down and shoppers head out
after work for another hedonistic binge
Downtown Hong Kong
But times have changed almost unfeasibly quickly and I
think the luxury market may be about to bleed a little into its
collective silk handkerchief. Sure, there is still enough money
in circulation but the way it is being spent has changed. The
Hong Kong shopper is now just as likely to hop on a plane to
Tokyo, Seoul, Paris, London or even New York to satisfy their
magpie-like desire for shiny things. Great news for those
cities perhaps but pretty shocking news for the domestic
luxury mall owners.
And there are more signs of changing
times. The latest Barclays European
Luxury Goods report shows that while the
Chinese customer has grown spending
in Europe at a massively respectable
33.7% year-on-year, the decline in Russian
spend is an alarming 51.2% for the same
period. Ying and Yalta you might say.
So where are the good news stories for
luxury retailers? Well they are few and
far between but I would favour Europe
and America over Asia right now as I
believe growth will be flat in Asia at best.
So who is set to benefit? For me the
answer is the ‘bridge brands’ and those
purveyors of affordable luxury. Step
forward Michael Kors, Jack Wills and
Ted Baker. Say hello to Maje and Sandro
and mingle with The Kooples. The list
goes on and I predict great things for
those who come to Asia in their own
right rather than through partners. You
will find doors open that were previously
closed and you will find an emerging
middle class ready to embrace your style
and your sensible price architecture.
The trend is set to be repeated in the
ever expanding waistlines of the food
and beverage sector. Only five years’
ago mall landlords, not just in Asia,
would cluster their restaurateurs in less
than 10% of their sales area. This has
now expanded to a portly 20% minimum
and the appetite for new trends, chefs
and culinary kudos is insatiable.
But signing up today’s coolest
cucumber in the culinary world can
be quite a gamble when your mall
development is some time away from
completion. All you can do is hold your
nerve, travel, learn from the mistakes
of others, travel and travel again.
My culinary hotspots are Tokyo (where
the power of social media alone can
create lines around the block for the most
prosaic cupcakes), New York, London
and Las Vegas (I kid you not). Vegas and
similarly Dubai are incredible importers
of the best in dining.
Andrey Bayda / Shutterstock.com
For those based outside of Asia, we look
forward to welcoming you to our home
markets at any time. We’ll even
buy you lunch…
[different] Spring 2015