Most Expensive Retail Addresses

I found this list of most expensive retail addresses at SecondCityStyle.com.

10. Gangnam Station
Seoul, South Korea
Price-per-square foot, per year: $431

9. Ermou Street
Athens, Greece
Price-per-square foot, per year: $451

8. Pitt Street Mall
Sydney, Australia
Price-per-square foot, per year: $489

7. Bahnhofstrasse
Zürich, Switzerland
Price-per-square foot, per year: $492

6. Grafton Street
Dublin, Ireland
Price-per-square foot, per year: $669

5. Ginza
Tokyo, Japan
Price-per-square foot, per year: $683

4. New Bond Street
London, U.K.
Price-per-square foot, per year: $814

3. Avenue des Champs-Elysees
Paris, France
Price-per-square foot, per year: $922

2. Causeway Bay
Hong Kong, China
Price-per-square foot, per year: $1,213

1. Fifth Avenue
New York City, N.Y.
Price-per-square foot, per year: $1,500

$1,500/sf annually! For a small 1,200 sf space the annual costs in rent would be $1.8M. I don't even know if that includes CAM, tax and insurance as well!

I would be naive to say that is truly expensive. Really, it's a function of sales and traffic. We see that each industry has their average percentage of revenue allotted for rent. Many companies that I have dealt with can usually designate around six percent of their annual revenue to rent. So, if in NYC a particular store can achieve $30M in sales from a 1,200 sf storefront then it may be a good deal. Right?

In contract a pretty good 1,200 sf storefront in Birmingham might need $400,000 in sales to get a similar return.