American Retailers Lead Global Expansion, While Asia is Hottest Destination

American Retailers Expanded Into More Foreign Countries, Cities Last Year than European, Asian Counterparts | Asia Claims Four of Top Five Markets for Expansion in CBRE Survey

​Los Angeles–May 20, 2016 – American retailers, which already operate in more foreign countries on average than their Asian and European peers, have widened the gap with a more aggressive international expansion pace, according to CBRE Group Inc.’s ninth annual “How Global is the Business of Retail?” report. CBRE released the report today ahead of RECon, the International Conference of Shopping Centers’ global convention set to take place in Las Vegas May 22-25. 

The report tracks the cross-border expansion of 334 international retailers in 2015 and separately gauges, from a city-level perspective, the extent of international retailers entering 155 cities across the globe last year.

CBRE’s survey of the retailers found that those based in the Americas expanded into foreign countries at a 3.1 percent pace last year, operating in an average of 22.3 countries. That’s faster than the cross-border expansion rates of retailers from Europe, the Middle East and Africa (1.7 percent) and of those from Asia Pacific (1.4 percent).

Meanwhile, CBRE’s analysis of foreign retailers’ expansion into 155 cities produced a similar finding. CBRE determined that the U.S. remains the largest exporter of retailers, accounting for 21 percent of retailers entering the surveyed cities. That tally led all origin countries, with Italy second at 14 percent, the United Kingdom third at 11 percent, France fourth at 10 percent and Japan fifth at six percent.

However, according to the report, the Americas don’t import retailers at remotely the same pace that the region exports them. Of the 20 hottest cities for cross-border retail expansion last year, only two – Toronto and Mexico City – are in the Americas. Half of the top 20 are Asian markets, with Hong Kong ranking as the hottest market overall by attracting 73 international entrants last year, up from 58 in 2014. That activity vaulted Hong Kong to the top spot overall from fourth in 2014.

“American brands have lost none of their strong resonance overseas, and the densely populated cities of Asia, Europe and the Middle East represent the ripest expansion markets for American retailers,” said Brandon Famous, CBRE’s Retail Leader for the Americas. “From a different perspective, foreign retailers sometimes find the Americas, particularly the U.S., to be a challenging, diverse market already loaded with competitors. They can expand in the U.S., but the approach often must be targeted and strategic.”

That said, the ranks of foreign retailers entering North America expanded last year, albeit from a small base. Thirteen percent of foreign retailers surveyed targeted expansion into North America last year in comparison to 3 percent in 2014. Likely drawing a few more international retailers to North America is the region’s gradually improving economy amid instability elsewhere. Within North America, Canadian retailers have shown an appetite for expanding into the U.S.

Another finding of the survey: On a global basis, food and beverage sellers led the categories of foreign retailers entering cities. Specifically, coffee shops and restaurants accounted for 20 percent of foreign retailers entering cities in the CBRE survey last year, boosted by considerable demand for foreign food-and-beverage outlets in Asia. Other leading cross-border expansion categories included luxury and business (19 percent), mid-range fashion (18 percent) and specialist clothing (17 percent).

In context, the global rate of cross-border expansion amounts to a moderate pace that is, by some measures, slowing. The largest reason for the slowdown is the growth of another aspect of retailing: ecommerce.

“With investment into online platforms increasing, more attention will be focused on reviewing store portfolios and ensuring that retailers have the right mix of locations,” said Mark Burlton, Global Executive on CBRE’s Retail Occupier team for EMEA. “In this environment, shopping centers that successfully attract expanding, foreign retailers will do so at least in part by fostering a compelling mix of leisure, lifestyle and food-and-beverage concepts amid their traditional retail concepts.”

Top Markets By Number of International Entrants in 2015

​Hong Kong (73 new entrants)​​	​Toronto (26)
​Singapore (63)	​Mexico City (26)
​Tokyo (57​)	​Seoul (26)
​Taipei (47)	​Jakarta (24)
​Moscow (40)	​Vienna (24)
​London (39)	​Manila (24)
​Dubai (38)	​New Delhi (23)
​Beijing (37)	​Bangkok (23)
​Bucharest (35)	​Madrid (23)
Doha (29)	​Paris (23)

To download the full report, click here​.

Methodology

The retailers were selected based on a variety of sources including surveys or retailers’ turnover and brand presence, global and national retail directories and the views if the local CBRE professionals on the dominant retailers in their markets. From these sources, 334 leading international retailers were identified as representatives of the global retail community. For each of the retailers in the sample, research was undertaken to identify whether they had a presence in each of the 61 countries and 191 cities included in the study.

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