The luxury market is booming once again: expensive handbags, elegant dresses and high-end watches are in greater demand than they have been for a long time. Investors are benefiting from shares in the luxury sector, whose values continue to rise. More and more Germans are also making their mark on the property market. Luxury high-rises, particularly in the city centres of Germany, are all the rage.
German high-end industry on the rise
The German luxury sector continues to grow at an above-average rate. Since 2018, the German high-end industry has grown by 46 per cent and has thus become a key pillar of the German economy. In 2016, it only just missed out on double-digit growth rates. Even so, the luxury industry posted a respectable growth figure of six per cent. Clemens Pflanz, Chairman of the Meisterkreis: “The German high-end industry is growing rapidly and generating significant added value both at home and abroad. It also creates numerous highly skilled jobs. Products ‘Made in Germany’ are not only winning over domestic customers. On the international market, too, German premium products are in greater demand than they have been for a long time. The automotive, engineering and audio/video sectors, in particular, are posting above-average growth figures.
LVMH dominates the global market
Louis Vuitton & Moët Hennessy: The French luxury goods group sets the tone for the entire global industry and has reported continuous growth in its business figures for years. The premium group brings together the world’s best-known brands, including names such as Louis Vuitton, Guerlain and Dior. Through regular acquisitions of rival brands, the group is constantly expanding its product range and thereby increasing its sphere of influence. Analysts estimate that this upswing is set to continue unabated in 2018.
According to industry experts, the main driver of growth is the Chinese consumer base. The appetite for luxury goods is particularly strong in the People’s Republic and appears far from being satisfied. A possible reason: a population of almost 1.4 billion represents a lucrative sales market. Furthermore, China is experiencing rapid economic growth. As a result, an ever-wider section of society is benefiting from rising prosperity. This, in turn, is fuelling Chinese consumers’ appetite for premium products. “The boom is immense,” notes Nick Hayek, CEO of the Swiss watch group Swatch. China’s share of the global luxury goods market currently stands at around one-third. The consultancy firm Bain & Company estimates that this share will reach around 44 per cent by 2025.
Higher, more expensive, more luxurious: Germans dream of luxury high-rises
Just a few years ago, high-rise flats in this country were decried as social housing. But thanks to the ongoing property boom, they are enjoying a renaissance. Particularly in city centres, anyone who considers themselves someone of standing lives at lofty heights. By 2022, 97 new residential towers are set to be built across Germany. Berlin will account for 27 of these, Frankfurt for 24. Seventeen will be built in Munich and 12 in Düsseldorf. Just a few years ago, however, residential towers were only to be found on the outskirts of towns. Their image was associated with socially deprived areas on the fringes of the city.
Their resurgence has led to a veritable cultural shift. Today, high-rises stand in the heart of the city and are equipped with all manner of modern refinements, in addition to glass façades offering perfect views and optimal natural light.
Not all high-rises are the same, however. In some German cities, there are limits on building height. In Munich, for example, buildings are officially not allowed to be taller than the Frauenkirche. Frankfurt, however, has a comparatively easy time of it in this regard. Its skyline is renowned far beyond Germany’s borders. Even more luxury residential towers serve to underline the city’s significance on the international financial market. The Europaviertel district, in particular, has set itself this goal. With luxury high-rises such as the Grand Tower and other imposing buildings, Frankfurt’s skyline is set to be further enhanced. Demand for high-rise flats remains strong. The same applies to modern office spaces. There is considerable interest in meeting rooms, individual offices and team offices. The COLLECTION Business Centre Frankfurt already makes these available on an hourly basis at cost-effective rates.
