Yahoo Finance L.A. Retail Market Outpacing New York for First U.S. Shops
When Italian luxury label Genny decided to open its first store in the United States, it didn’t head to New York City where most European brands make their first retail splash.
Instead, the feminine, sensual womenswear brand, whose fans include Jennifer Lopez, Rita Ora and Eva Longoria, landed in Beverly Hills around the corner from Rodeo Drive.
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Taking that same retail route recently, Represent, the 13-year-old British streetwear brand that last year collaborated with the rock band Mötley Crüe on a capsule collection, opened its first American outpost on North Robertson Boulevard in West Hollywood. British swimwear brand Hunza G followed suit, debuting its first U.S. store as a pop-up on Melrose Avenue.
“Honestly, there is a major, major shift in retail that is occurring,” said Houman Mahboubi, a CBRE senior vice president in L.A. for the real-estate company’s high-street retail division. “It used to be New York first and then Los Angeles. But now it’s L.A. first and then New York.”
In the past few years, the second largest city in the U.S. has gained more retail clout for several reasons. First, L.A. is the celebrity and influencer capital of the world. Put a dress on Lopez or Kim Kardashian and sales soar. “If a brand wants to go worldwide, they are tapping into the celebrity market that lives in Los Angeles,” said Jay Luchs, a vice chairman at Newmark, a commercial real estate firm, who deals in high-end retail deals. “And L.A. for social media has become really important with the influencer generation.”
Influencers and celebrities were the main attraction for Genny, whose other two stores are in Italy. The brand founded in 1962 got a lot of wattage in 2020 when Jennifer Lopez wore one of its white sheer cutout dresses for her music video “PaTi Lonely,” with a trailer that was broadcast for two weeks in New York’s Times Square. The star has worn the brand multiple times since, including at an “Atlas” photocall last month in New York.
Sara Cavazza Facchini, Genny’s creative director, said the brand is counting on a Southern California store presence to generate even more celebrity dressing and red carpet exposure.
Georgiana Huddart, the cofounder and creative director of Hunza G, said L.A. was her first U.S. retail choice because the brand’s crinkle-knit swimwear was discovered by Rihanna and Kim Kardashian two years after the label was resurrected in 2015. It was a great revenue generator. “L.A. was the first place where we got noticed, and we don’t pay influencers,” she said. “We’ve been very lucky about that.”
Silk Laundry, a nearly 10-year-old Australian brand, is unveiling its first U.S. store on Melrose Avenue in West Hollywood. Founder Katie Kolodinski was attracted by the area’s mild climate, which goes well with her light silk clothing. But it doesn’t hurt being on a popular shopping street frequented by influencers and stylists.
The brand has already been getting increased celebrity attention. Jake Gyllenhaal wore a Silk Laundry oversize boyfriend twill silk shirt when hosting the season finale of “Saturday Night Live,” and actor Sebastian Stan was seen sporting a full Silk Laundry while attending the Cannes Film Festival last month in France. The two actors share the same stylist, Michael Fisher.
Streetwear, Fine Jewelry Players
Southern California’s skate and streetwear vibe and heritage is what drew Represent, the 13-year-old luxury streetwear label from Manchester, England. Until recently, the brand only sold merchandise online and through wholesale accounts, pushing annual revenues to around $100 million.
“We have a huge ambition to be a global player. We knew that if we want to be globally significant, we would have to be a significant player in Los Angeles,” explained George Heaton, one of the two brothers who founded the label that makes an array of outerwear, T-shirts, hoodies, denim, cargo pants, puffer jackets, swimwear and shoes that sell in the $200 to $500 range.
Represent joins other streetwear brands in the area that have a major retail presence, including Supreme, The Hundreds, Madhappy and Kith, as well as luxury neighbors Maxfield, H.Lorenzo and Chrome Hearts. And its already attracted an eclectic crowd that’s a cross section of sports, social media and young Hollywood. The April store opening party brought out Swedish DJ and music producer Alesso, American fencer Miles Chamley-Watson, Spanish soccer player Riqui Puig, social media personalities Noah Beck and Chase Hudson, Miles Richie, son of Lionel Richie, and Paris Brosnan, son of Pierce Brosnan.
Late last year, MB&F, a Swiss watchmaker known for its rare and expensive limited editions and futuristic designs inspired by science fiction and retro-futuristic vehicles, opened its first MB&F Lab in the U.S. on Rodeo Drive in Beverly Hills. Other MB&F Labs are located in Singapore; Paris; and Taipei, Taiwan.
Charris Yadigaroglou, MB&F’s head of marketing communications, said L.A. was selected to house one of its rare lab locations, also displaying kinetic art, because the city is a haven for high-end watch consumption and collection.
Messika, a French modern jewelry line designed by Parisian Valérie Messika, ventured to L.A. in 2019 to plant its first U.S. retail flag at the Westfield Century City shopping center. At the time, its partner, Westime, was running the store.
Early this year, Messika took over store operations. With jewelry pieces worn by superstars including Beyoncé, Cardi B and Lady Gaga, Messika wanted to tap more extensively into L.A.’s mega-celebrity power and lifestyle. “The Californian way of life works perfectly with the Messika spirit,” the French jewelry designer said in a statement.
The Rising Sports Scene
Outside of top-tier celebrity power, another retail attraction is sports and athletics. “Given its proximity to the ocean, the mountains and the deserts, Los Angeles is a very active sector of the world that plays a role in catering to skaters and athletes,” explained Devin Klein, a vice president with JLL real estate’s high-street retail team in L.A.
Soon, the city will experience an unprecedented trifecta of major world events. In 2026, L.A. will host eight matches for the FIFA World Cup, drawing thousands of international travelers and sports enthusiasts. In early 2027, the LXI Super Bowl will take place at SoFi Stadium, attracting hordes of fans and millions of TV viewers. And in 2028, the Olympic and Paralympic Games will land in Southern California. To get an idea of the megawatt economic benefit generated by the event, this summer’s Olympic Games in Paris are expected to draw 15 million people. All these global competitions are placing a retail halo over the City of Angels.
Tapping into the L.A. soccer vibe is Paris Saint-Germain, a French soccer team that sells branded merchandise. It opened its first U.S. store two years ago at the Westfield Century City location. “Sales at the Paris Saint-Germain store were above expectations,” said Brandon Williams, vice president of global communications for Fanatics Inc., a leader in licensed sports merchandise. Fanatics has a retail and merchandising deal with Paris Saint-Germain.
Last May, the soccer team’s two-year lease ran out. But the outpost was so successful, Paris Saint-Germain decided to search for a larger retail outpost, Williams said.
Retail Rents and Vacancies Impacted
With all this retail activity bubbling up, rents on the most sought-after retail streets are rising and vacancies are declining. Rodeo Drive has almost no vacancy and the surrounding streets are filling up fast. “There is a waiting list to get on Rodeo Drive,” Mahboubi of CBRE said.
Rents on Rodeo Drive have increased 10 percent to 20 percent in the last two years, fetching $960 to $1,300 per square foot a year. And rates on Brighton Way between Rodeo Drive and Camden Drive, where Genny is located, are the highest they have ever been, rising to $420 to $516 a square foot a year. Nearby Beverly Drive, which has seen a retail explosion of new stores, including Reformation and L’Agence, has experienced a 25 percent rent increase in the last two years to $192 to $240 a square foot per year.
On top of the retail, a bevy of high-end restaurants are opening in Beverly Hills, many marking their first West Coast appearance. Earlier this year, Cipriani, the 93-year-old legendary New York Italian eatery, opened an elegant eatery with polished wood interiors and Murano chandeliers to much fanfare on Camden Drive.
Joining the restaurant lineup on that street soon is Marea, another New York Italian dining spot, first opened in Manhattan in 2009. Another newcomer to Camden Drive will be Gravitas Beverly Hills, an exclusive private social club occupying a 12,000-square-foot space. While the club will be for members only, there will be a high-end restaurant open to the public. And renowned Michelin-starred chef Daniel Boulud is opening his first West Coast restaurant, Café Boulud, later this year at the Mandarin Oriental Residences on Wilshire Boulevard.
The influx of retail and restaurants is a sign that L.A. is the place to be. “Everyone,” commercial real estate agent Mahboubi said, “wants to make their mark on Los Angeles.”
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