Forget Fifth Avenue and Beverley Hills — retailers can find just as good of a location in cheaper corridors today, a new report from commercial real estate firm Jones Lang LaSalle (JLL) has found.
"We know that sometimes retailers want that prime main-and-main location, but just don't have the budget," Naveen Jaggi, president of retail brokerage at JLL, said in a statement. "So, we've looked at nine core U.S. cities to find more affordable areas for retailer expansion."
JLL's first ever "City Retail" report highlights the top 10 U.S. shopping districts, calculated according to rent price per square foot. They all boast growing populations of working millennials, rising food scenes and a healthy mixture of up-and-coming retailers and traditional brands.
In descending order, here's a look at how the top 10 stack up, including highlights from JLL's report:
10. Fillmore District, San Francisco
Average asking prime retail rent: $115 per square foot
Annual rent growth: 13.6 percent
"It's been eight years since the transformation of the Fillmore corridor started, and today luxury lite retailers are dominating the retail scene."
9. Metro Center, DC
Average asking prime retail rent: $100 per square foot
Annual rent growth: remaining flat
"Well positioned between the White House and Chinatown, Metro Center is where people go to shop at well-known brands and discount retailers."
8. Design District, Miami
Average asking prime retail rent: $95 per square foot
Annual rent growth: 2.2 percent
"Textile and furniture factories once lined the Design District, which is now a curated assortment of luxury retailers, art galleries and restaurants. Phase II of development will add 60 new tenants to the market."
7. Hayes Valley, San Francisco
Average asking prime retail rent: $90 per square foot
Annual rent growth: 4.7 percent
"Opportunities for investment and new storefronts in Hayes Valley is shrinking, as housing values increase and entertainment venues play host to tourists."
6. University Avenue, Palo Alto
Average asking prime retail rent: $90 per square foot
Annual rent growth: 7.9 percent
"Palo Alto's tech boom is creating a retail sea change with more non-chain boutiques and home goods stores moving in to University Avenue."
5. The Marina, San Francisco
Average asking prime retail rent: $85 per square foot
Annual rent growth: 7.7 percent
"This corridor has seen a spike of athleisure and boutique fitness studios, adding to its long-standing assortment of neighborhood retail and restaurants."
4. Fulton Market District, Chicago
Average asking prime retail rent: $75 per square foot
Annual rent growth: 8.9 percent
"Once a hub for industrial and meat distribution, Fulton Market in the West Loop submarket is known for its killer restaurant scene, but is now garnering attention from apparel retailers and investors as it becomes a growth market for corporate headquarters."
3. Pike Street, Seattle
Average asking prime retail rent: $65 per square foot
Annual rent growth: 18.2 percent
"Filled with a stable collection of apparel and restaurants, Pike Street serves Seattle's [Central Business District] and is expanding east toward Capitol Hill with new restaurants."
2. Wicker Park, Chicago
Average asking prime retail rent: $55 per square foot
Annual rent growth: 4.5 percent
"This edgy, off-the-beaten path foodie destination is seeing an uptick in residential development, piquing international investor and retailer interest."
1. Market East, Philadelphia
Average asking prime retail rent: $50 per square foot
Annual rent growth: 25 percent
"Once home to vacant lots and failed fortress malls, Market East is now attracting large-format retailers looking to tap into the swelling millennial and empty-nester population."