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News release

CHICAGO, IL

Asia is the New Land of Opportunity for U.S. Retailers

North Asia and Greater China have the highest presence of U.S. retailers


CHICAGO, Aug. 20, 2014 – Will Asian shoppers buy into the classic all-American look? United States-based mid-level casual apparel brands, are hedging their bets that “preppy” rugby polos and chic velour track suits will entice Asia’s rapidly growing middle class to buy U.S. goods. Newly released JLL research shows that U.S.-based brands are flocking to Asia faster than any other , knowing an untapped market awaits: 

  • Approximately 21 percent of retailers expanding into Asia are U.S.-based, followed by Italy and the United Kingdom
  • More than one third of mid-tier retailers  migrating to the market are U.S.-based
  • North Asia and Greater China stand out as the markets for greatest returns for retailers

“Rising income levels in Asia mean that an all-new consumer base can afford to purchase fashion and luxury items for the first time,” said Michael Hirschfeld, Senior Vice President of JLL’s National Retail Tenant Services. “Middle-class buyers are rapidly turning to the urban core, creating dense areas with top-shelf demographics – a perfect entry point for international retailers.” 

In the coming decade, urbanization will drive wealth creation and mold consumer buying habits in the Asia Pacific region. Established U.S. mid-tier brands are expected to grow in peripheral Asian markets, while luxury retailers are anticipated to focus on the core markets, like Hong Kong, as many brands view it as a stepping stone to enter Mainland China. Shanghai and Beijing will also remain top targets, as the markets’ retail sales grew an average of 15 to 17 percent during the last three years.      

“While the growth of luxury goods sales in China has cooled since 2013, it hasn’t been across the board,” said Jane Murray, Head of Asia Pacific Research for JLL. “Light luxury U.S. retailers are performing with strong same-store sales growth in China. There are strong growth prospects in the market, and though expansion will be very methodical and selective, we expect U.S. brands to continue to develop their footprint in the region. One of the major drivers is increased Chinese tourism, with the Chinese estimated to be the largest luxury spenders worldwide.”

While gateway U.S. cities remain top targets for growing retailers, major U.S.-based brands have simply run out of locations to expand at home without oversaturating their presence. Asia is set to account for 40 percent of the world’s economy by 2020, growing twice as fast as the rest of the globe and JLL anticipates that established brands will begin to target outlying tier two and tier three cities. The region’s rapid growth and the purchasing power of its emerging 1.3 billion middle-class consumer base during the next six years is expected to continue to pique the interest of U.S. retailers.

JLL’s Retail Group serves as the industry’s leader in retail real estate services. The firm’s more than 800 dedicated retail experts in the Americas partner with investors and occupiers around the globe to support and shape investment and site selection strategies. Its retail specialists provide independent and expert advice to clients, backed by industry-leading research that delivers maximum value throughout the entire lifecycle of an asset or lease. The firm has more than 90 retail brokerage experts spanning more than 25 major markets, representing more than 440 retail clients. As the largest third party retail property manager in the United States, JLL’s retail portfolio has 350 centers, totaling 67 million square feet under management in regional malls, lifestyle centers, grocery-anchored centers, power centers, central business districts, transportation facilities and mixed-use projects. For further information, visit www.jllretail.com

For more news, videos and research from JLL’s Retail Group, please visit: www.jllretail.com

About JLL
JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual fee revenue of $4.0 billion and gross revenue of $4.5 billion, JLL has more than 200 corporate offices, operates in 75 countries and has a global workforce of approximately 53,000.  On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 3.0 billion square feet, or 280.0 million square meters, and completed $99.0 billion in sales, acquisitions and finance transactions in 2013. Its investment management business, LaSalle Investment Management, has $50.0 billion of real estate assets under management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com.​

 

i and ii About A Magnet for Retail: Research Methodology
This report examines the presence and expansion patterns of 100 top international retailers, both luxury and mid-tier, in 30 major cities in the Asia Pacific region. JLL identifies major trends in key markets across the region, taking into account factors such as retail sales, market size and rental rates. It is evident that the presence of international retailers varies across geographies and also by retailer category. However, with strong growth prospects we are seeing both mid-tier and luxury brands from different parts of the world expanding to numerous locations in Asia Pacific.