5 Martin Place, Sydney, the new home of German luxury luggage brand Rimowa. Photo: Supplied
Rimowa, the German luxury luggage group, is set to call 5 Martin Place home as the retail sector looks to the upmarket brands for revenue growth.
The label is being distributed exclusively through Hunt Leather, which itself has a presence in the MLC Centre.
Sophie Hunt, whose parents founded Hunt, said the group also runs the Longchamp Boutique, of which there are four stores nationally and Hunt’s own five sites throughout Australia.
Ms Hunt said the group opens a newly branded store in Australia every year and, despite the massive growth of its online business, it still invests in bricks and mortar.
“Demand is high for luxury brands and over the years that we have stocked Rimowa, we have been pleased with the high turnover of the items,” Ms Hunt said.
“Finding the right location was imperative to launch the store as a stand-alone and certainly, 5 Martin Place is where we want to be.”
Ms Hunt said Rimowa is considered a destination brand and the demographics of Martin Place, being in the heart of bankers and lawyers, was the perfect fit.
“We will be looking to expand and while online sales are strong, having a store is still our preferred option,” Ms Hunt said.
DEXUS Property is leasing out 5 Martin Place as part of the redevelopment and has also signed up the H&M associate Collection of Style, and the Canadian apparel group Kit & Ace, in what was the former Commonwealth Bank chamber.
Rimowa’s opening in December – the date is still be decided – comes as luxury retail is making a comeback.
CBRE Australia head of retail tenant representation said the country offers significant opportunities for luxury retailers at a time when the Asian market is reaching saturation point.
In a new CBRE report, The Future of Luxury Retail in Asia Pacific: New Demand Drivers and Shifting Occupier Requirements, it says most major luxury retailers are now well established in Asia-Pacific with China and Hong Kong being two of the most penetrated markets at 89 per cent and 81 per cent respectively.
“However, following several years of rapid expansion, these markets are approaching saturation point and several luxury brands have halted expansion amid sluggish sales,” the report says.
“Conversely, the penetration rate of luxury retail in Australia is just 50 per cent – primarily due to the dominance of department stores in this segment of the market.”
However, the tide is shifting, as luxury brands launch stand-alone stores in Australia to exert stronger control over their business operations and brand.
In 2014, a total of 16 luxury retailers entered Australia or opened their first stand-alone store in five cities – double the total in 2012 and 2013 combined.
“Australia, unlike much of Asia, is far from saturation point in terms of luxury retailing,” Mr Starling said.
“At present we are witnessing the largest influx of new luxury brands in the country’s history. This is coming from two distinct sectors, with fashion/ready-to-wear and jewellery retailers being the most inquisitive.”
Mr Starling said the inquiry was being driven by larger groups such as LVMH, Kering Group and Richemont, but brands such as Valentino and Moncler also had Australia on the radar.
“Another trend we are witnessing involves brands being more willing to seek space in shopping-centre environments,” Mr Staring said.
CBRE national director retail services Alistair Palmer said a new luxury precinct was also poised to open Pacific Fair on the Gold Coast in 2016, and Chadstone was planning to double its luxury offer.
An increase in Chinese tourist arrivals was helping to support the luxury retail sector in Australia, Mr Palmer said, particularly in light of the fall in the Australian dollar.
“Sydney Airport is also establishing a new luxury precinct, with many of the tier 1 and affordable luxury brands opening in order to capture the Asian tourist market,” he noted.
