Amelia Bright, Executive Director, Grosvenor Property UK

Beyond the headlines, the West End has been calmly reasserting its position as the strongest retail destination in one of the world’s few global capital cities. The recovery is however uneven, with data showing diverging performances between individual streets and demonstrating that success will be contingent on investment and innovation to drive growth.

Who’s coming to the West End?

Despite its challenges, the West End saw a faster rate of net openings, or a slower rate of net closures, in 2023-2024, than has been the trend across the UK in the last decade. 

2022-23 data also shows that in 57% of retail categories, the change in West End stores numbers was better than the long-run UK trend. This was driven by dining and fashion and hair and beauty openings. 

Led by the surge in socialising post pandemic and despite inflation, Kantar reported that transactions in the UK’s restaurants in 2023, pubs and bars were up c11% year on year and dining was back to pre-pandemic levels. In the same year, Hot Dinners reported that London restaurant launches were almost back to pre-pandemic levels, however the effect of this growth was not even - almost half of openings were in the W1 postcode.

Furthermore, the continued demand among luxury retailers to not just occupy, but own, stores in prime locations demonstrates that even as luxury spend goes online, committing to a physical presence remains an important part of high-end retail strategies and competitive advantage. As a result, West End retail vacancy appears to have peaked in the short-run.

UK net change in store numbers (avg. annual since 2014) Vs recent West End net change in store numbers (2023-24) Source: LDC, ONS, Grosvenor Research

Where are they going?

In a world where overall in-store retail spend is declining in real terms, success will depend on landlords investing in their assets, places and consumer experiences to support retailers’ wider branding and sales strategy, both online and offline. And choice is coming down to individual streets.

Visa credit card spend data shows that there are already significant differences in between streets’ in-store turnovers across the West End. New Bond Street, Mount Street and North Audley Street are particular bright spots where spend has been growing – all following significant investment. In addition, rents on key retail streets, particularly where food and beverage operators are coalescing have begun to grow again, even adjusting for inflation.

The market however is never static, and we can expect future data to reflect the benefits of the Oxford Street public realm project, welcome candy store crackdown and Elizabeth Line impact as well as, for example, the near complete transformation of Sloane Street. 

Closer to home, we saw retail vacancy fall to 3.9% at the end of Q1 2024 across our Mayfair and Belgravia portfolio, compared to a West End average of 11% (source: LDC).

This stems from significant multi-year place and asset management but also the wider support we offer to retailers – making it easy to set up shop and operate. Innovations include a fully digitised leasing process that can take 72 hours to complete and reduces legal costs, funding and advice to support opening and a year-round marketing programme. Our retrofit works and ongoing engagement on energy efficiency are also mitigating against energy bill rises and helping retailers deliver against their own sustainability promises – critical to consumer loyalty.

Activations also supporting cashflow – the 2023 Coronation Street Party attracted over 10,000 people to Mayfair and, compared to the same weekend in 2022, retail turnover increased by c+41% and participating food and beverage businesses saw a c+33% rise in revenues. 

Future investments like the £500m South Molton development and the transformation of Grosvenor Square will also ensure that Mayfair remains relevant and resilient amid changing needs of occupiers and their customers.

 This article was originally published in Estates Gazette.