With a recent influx of high profile food and retail offerings in Baker Street, W1, substantial change is taking place within the retail landscape of the area. This has resulted in a record high for rental levels, with £265 per sq ft, which is a 38 per cent increase from the last high.
Its nearby area, Marylebone High Street, has next to zero vacancy rates and high rents, so combined with the improved profile of the area for office occupiers, retailers are relocating to Baker Street. The goal for operators is to take advantage of the office and tourist population who go to the area throughout the year, squeezing independent and local retailers out of the market.
Over the past six months, Knight Frank’s retail team has completed five transactions that have resulted in give new occupiers taking residency in the area. Just north of Marylebone Road on Upper Baker Street, space has been taken up by Dunkin’ Donuts, Alef Bookshop and Burgista, a new burger restaurant.
In recent years, Baker Street has evolved exponentially and since become a major office destination. Back in 2008, Knight Frank got the ball rolling by locating its HQ to number 55 Baker Street and most recently, British Land took residency nearby and redeveloped 10 Portman Square, as well as provide 10,549 sq ft of retail space.
The past twelve months has seen Baker Street getting record breaking rents and premiums being paid so sites are being secured, like Sainsbury’s who have paid a six figure sum in order to keep their store secure at 116 Baker Street.
Associate of Knight Frank’s Retail team, Josh Braid, said: “Baker Street is currently experiencing an exciting new phase of Central London retail activity, and the rapid increase of grab ‘n’ go operators, due to the ‘over spill’ effect from traditional prime streets.
“Other secondary retail locations benefiting from this are Conduit Street, Lower Regent Street, Redchurch Street and Tottenham Court Road. All these locations have seen substantial increases of international retailers due to key redevelopments and the lack of space.”
The next twelve months will see a dramatic increase in retail activity for the roads closest to Baker Street and Marylebone High Street, such as Marylebone Road, George Street, W1 and Paddington due to the overspill of occupier demand. There is also an opportunity coming up for the commercial sector with the redevelopment of 93 Baker Street.
