Singapore outpaces global luxury retail market with 2% rental growth

Rents only rose by 0.9% globally in 2025.

Singapore’s luxury retail market outperformed global peers in 2025, recording 2% growth in prime luxury retail rents amid a broader slowdown in the sector, according to Savills.

Savills’ Global Luxury Retail Outlook 2026 reported that average prime headline rents across 27 major luxury retail destinations worldwide rose by 0.9% in 2025, sharply down from the 6.6% growth recorded in 2024 as global macroeconomic uncertainty and shifting travel patterns tempered occupier demand.

Despite the slowdown, Singapore remained among the world’s top 10 destinations for new luxury store openings, reinforcing its position as a key gateway for regional wealth and international tourism. The city-state ranked alongside Tokyo, Bangkok and Shanghai as one of the few Asia Pacific markets to feature prominently in global luxury retail expansion activity.

According to Savills, limited availability in prime shopping districts such as Orchard Road and Marina Bay has concentrated demand into a smaller number of premium locations, intensifying competition for flagship retail space and supporting continued rental growth.

Sulian Tan-Wijaya, executive director of retail and lifestyle at Savills Singapore, said the city-state continues to attract ultra-high-net-worth individuals and luxury brands due to its reputation as a stable financial hub.

Savills also noted that Singapore remains a preferred luxury shopping destination for wealthy consumers from markets including the United States and Germany, further strengthening its appeal as both a retail and travel destination.

Globally, the report found that luxury retail strategies are becoming increasingly selective as prime space tightens across core markets. Europe emerged as the strongest-performing region in 2025, posting average rental growth of 1.2%, with gains extending beyond London, Paris and Milan into smaller luxury destinations such as Amsterdam, Vienna and Copenhagen.

Anthony Selwyn, co-head of global retail at Savills, said luxury brands are recalibrating expansion strategies as constrained availability and limited high-quality opportunities become the main drivers of activity.

Meanwhile, Marie Hickey said luxury rental growth had normalised following the strong rebound in 2024, although supply shortages on prime retail streets are expected to continue supporting rental pressure into 2026.