APAC retail leasing demand bolstered by rise of new energy vehicles
NEV brands are looking for space in markets such as Tokyo and Seoul.
According to a recent report by CBRE, New Energy Vehicle (NEV) manufacturers and retailers are emerging as a strong source of retail leasing demand across Asia Pacific. This is being driven by steady increases in sales, which reached over 3.2 million units worldwide in 2020, and initiatives to phase out vehicles that run on fossil fuels.
China has seen the strongest growth in footprint, with local and international NEV companies establishing stores in shopping malls that frequently resemble high-end luxury retail outlets rather than traditional car dealerships. New openings in Q1 2021 included Chery, Lingpao, Xpeng, NIO and Volvo.
Here’s more from CBRE:
More recently, Tokyo has seen several overseas NEV brands seeking space for service centres and looking for units in wealthy residential areas. Newcomers searching for showroom space in Central Tokyo for brand building purposes.
Other growth markets include Seoul, where overseas brands are looking to enter the market and local groups are seeking smaller showroom type spaces. High streets in Cheongdam-dong to Sinsa-dong are among the preferred locations.
While NEV brands will remain a key source of leasing demand this year, several brands have turned more conservative towards CapEx in recent quarters. Some groups continue to seek flagship store space but are less aggressive in bidding up rents.
Nevertheless, ongoing retrenchment by fast fashion retailers across the region could create opportunities for NEV brands to secure large and prominent shopping mall and high street shop units in the coming months.