Rents for prime central London shops soared by 9% in the final quarter of 2015, the fastest growth for the sector since 1988, according to CBRE figures.
For the whole year, rents for central London shops rose by 18% and nearly a third saw increases in Q4.
However, in the rest of the UK CBRE recorded prime retail rents increase by 0.8% in Q4 and a rise in estimated capital values by 1.4%, having little impact on yields, which stood at 6%.
Over the year, prime rents and estimated capital values for shops outside central London increased by 1% and 3.2% respectively.
During December, footfall for UK retailers declined by 3.9% and retail sales grew at 0.1% compared to December 2014, while online retail sales rose by 15.1%.
CBRE head of UK retail Phil Cann said: “The Christmas period has been a mixed bag for retailers, with retail sales rising slightly on December last year, despite a marked retreat in footfall from UK high streets. Nevertheless, central London continues to boast some of the most sought-after retail spaces in the world, a fact brought to light by the quite remarkable jump in rents toward the end of 2015.”
“Luxury retailers are chasing very limited available stock, sending rents soaring as they pay to place themselves at the heart of London’s luxury marketplace.”
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