Building Blocks: Rue Saint-Honoré, Paris, France
The rue Saint-Honoré runs almost 2km between the CBD and Les Halles, a major transport hub and luxury shopping district. David Bourla Chief Economist and Head of Research at Knight Frank France, discusses its appeal
1 minute to read
Why is it up and coming?
The transformation began in 2011 with the opening of the Mandarin Oriental hotel. In just a few years, the street has become a target for major retailers, accounting for almost a quarter of all luxury store openings in Paris. The flagships of several of the world’s most prestigious brands are concentrated within less than 800m, including Chanel, Saint Laurent and Louis Vuitton. The boom shows no sign of slowing down: Burberry and Dior are both planning openings in 2020, along with high-end hotels including an extension to the fashionistas’ favourite Hôtel Costes.
My favourite bits
The Saint-Honoré district is also the gourmet heart of the French capital. Among the established Michelin-starred restaurants, some exciting newcomers are making their mark. Balagan, on rue d’Alger, is among the most popular proponents of the new Israeli cuisine that has proved such a hit with Parisian diners.
Who’s buying?
North American funds, European private funds and investors, French private funds and insurers.
What are prime yields (cap rates) in the area?
Between 3.5% and 2.5%, or even less for the best assets with reversionary potential. Rue Saint-Honoré has the lowest rates on the market, comparable to the levels seen in other leading Parisian luxury and tourist districts such as Avenue Montaigne or the Champs-Élysées.