Luxury high street yields remain the most stable among retail investment properties

According to Savills research, European retail investment volumes reached €19 billion from Q1 to Q3 2024, reflecting a 6% year-on-year increase. Among retail property sectors, luxury high street yields remain the most favorable and stable at 4.4%, a trend also mirrored in the Czech Republic. The enduring attractiveness of high street assets was recently underscored by the acquisition of the iconic Louis Vuitton building at Pařížská 3 in Prague by Raiffeisen realitní fond, managed by Raiffeisen investiční společnost, a. s. Savills has secured the property management mandate for the prestigious asset.

“An exceptional building requires an individual and professional approach. Added value comes from proactive efforts, accountability for operational results, and meeting owners’ expectations. Our relationships, energy, and dedication are the investments we bring to property management projects. I believe strong, long-term partnerships based on trust and professionalism are key,” says Petra Gaceková, Business Development Lead, Property Management at Savills Czech Republic & Slovakia.

Retail Investment by Sector

High street retail accounted for 18% of total European retail investment volumes between Q1 and Q3 2024, while retail parks represented 28% and shopping centers 26%.
• Luxury High Street Yields: Remained stable at 4.4% year-on-year.
• Prime Shopping Centre Yields: Increased by 9 bps annually to 6.3%.
• Mass-Market High Street Yields: Compressed by 4 bps annually, reaching 5.2%.
• Prime Retail Warehouse Yields: Decreased slightly by 4 bps year-on-year to 5.9%.

With signed deals since October and transactions currently in the pipeline, Savills projects Q4 2024 retail investment volumes in Europe to reach approximately €8.5 billion. This would bring the total for 2024 to just over €27.5 billion, marking a 15% increase compared to 2023.

The stability of luxury high street yields, combined with strong investor interest, reinforces the sector’s resilience and continued appeal in an evolving retail investment market.