There are seven hotels in the pipeline for the Shoreditch area including Gansevoort, Nobu and CitizenM, which, according to Savills, will have a further impact on the shopping offer as retailers will increasingly see the area as an international destination. The firm highlights that for some retail brands the presence of these hotels will act as a draw as they look to align themselves with hotel brands and their clientele.
Savills notes that with these new hotels there will be a 137% increase in ‘overnight guests’ in the Shoreditch area, going from 130,000 to 308,000 by the end of 2018. The opening of The Boundary Hotel and Shoreditch House, the firm reports, was a key catalyst on the rising profile of Redchurch Street as a fashion destination with a number of brands subsequently opening including J Crew, Versace’s Versus brand and The Modern Society Boutique. Old Spitalfields Market has also seen a number of new brands opening including Alexander McQueen, Belstaff and Jo Malone.
Marie Hickey, director of Savills research, comments: “The attraction of the Shoreditch area was originally driven by its reputation as a creative hub, in turn boosting its visitor appeal. Hotel brands have latched onto this appeal. What is really interesting now is that we’re seeing international ‘luxury’ hotel brands such as Nobu and Gansevoort open their first London outposts in Shoreditch and its the profile of these brands and their clientele, along with the office and residential story, that will be a key driver of the evolution of Shoreditch’s retail offer.
“The locations best placed to capitalise from this are likely to be those locations under single ownership, such as Old Spitalfields Market, as they are able to ‘curate’ the retail experience providing tenants some comfort in terms of alignment of neighbouring brands as well as coherently marketing it as a retail destination.”
As the new hotels in the Shoreditch area attract international visitors, Savills notes there has been increased interest from non-domestic brands such as Cos and Anthroplogie opening on Brushfield Street, MAC and Bobbi Brown in Old Spitalfields Market. Furthermore, Savills research shows that rising demand for retail space is already feeding through to rental growth with a 11.8% average annual increase in prime ZA rents in the Shoreditch area over the last two years.
Oliver Green, director of retail at Savills, comments: “A number of retailers are increasingly looking to the Shoreditch area in the same way they would look to the West End as they wish to gain exposure to London’s international visitors. We expect this to continue as schemes such as Old Spitalfields Market and Redchurch Street firmly establish themselves as shopping destinations.”
More recently, Savills notes the opening of Andre Balazs Chiltern Firehouse has had a similar impact on Chiltern Street in Marylebone, and also The Rosewood Hotel and The Hoxton are having an effect in Holborn.
