Public realm improvements in London and other urban centres are costly and disruptive, however the benefits can include enhanced residential and commercial property values, new retail tenants and an influx of inward investment. These are just some of the findings of a detailed new report by Mayfair Estate Agents Wetherell entitled: The Mount Street Report: Doing a Grosvenor.
The report reviews how Grosvenor has defined public realm enhancement best practice with the transformation of Mount Street in Mayfair from a weak secondary thoroughfare into one of London’s leading luxury brand destinations. This has influenced other London estates to look at replicating the success of Mount Street in a dozen locations across the capital.
Until a decade ago, Mount Street was home mainly to art and antiques dealers. Then the Grosvenor Estate undertook public realm improvements, begun in 2010 and completed in 2011. The works were funded by an innovative arrangement with Westminster City Council who invested the initial £10m, with the balance undertaken by Grosvenor. In total, £80m was spent turning Mount Street into a luxury retail destination, where crossings were simplified, lighting and street furniture was improved and public art work was installed.
As a reflection of the street’s enhanced desirability, shop rents have risen by 330% between 2006 and 2012, says the report. In 20 years, average rents on Mount Street have risen from £16,000 per annum to an average £150,000 per annum today.
Since 2010 there have been over 20 new retail outlet openings on Mount Street, representing over £200m of new investment and development. The latest luxury brands openings in 2014 include Moynat, Celine, Gina, Roksanda Ilincic, Richard Mille, Christoper Kane and Creed Fragrances.
The world’s most prestigious brands now pay as much as £3m in upfront ‘key money’ simply to secure a lease on Mount Street, these brands. These brands will then lavish anything from £6m upwards on refitting their shop and paying additional premium market rents.
After reviewing 12 key luxury brand addresses around the world including Bond Street and Sloane Street in London, Rue St Honoré in Paris as well as Madison Avenue and Fifth Avenue in New York, it has been identified that the success of these 12 locations can be attributed to 18 “key ingredients”. These include attractive architecture; high quality public realm (artwork, street furniture, fountains, planting); wide boulevards; access to public transport; strategic plan by landlord and local authority; retail complimented by quality residential, leisure and hotel properties; good footfall and signposting; and a tenant association (for fostering allegiance amongst tenants and organising promotional events).
Mount Street has been so successful that its makeover is now known by many within the property profession as “doing a Grosvenor”. The report reveals a wave of other London locations where Mount Street style public realm activities are taking place or in the pipeline. These include Duke Street, Savile Row, Dover Street Elizabeth Street, Marylebone High Street, Chiltern Street, St James’s Street, Pall Mall, Covent Garden, Fulham Road and Wilton Road.
Peter Wetherell, Chief Executive of Wetherell said:
“Our report shows that Grosvenor shrewdly undertook a multi million pound street restoration on Mount Street, creating a new high quality street scene. Now it’s viewed as a complimentary address to Bond Street and as a destination, rather than simply a thoroughfare.”