Press Information
THE HARRODS EFFECT
REPORT FINDS PROPERTY PRICE PLATEAU CENTRED ON HARRODS,
UNDERLINING ITS ROLE IN MAKING KNIGHTSBRIDGE A PREMIUM ADDRESS
Harrods Estates highlights that for many years property experts have observed that
wealthy purchasers and tenants from around the world have wanted to live as close as
possible to the world famous Harrods department store. This has created a huge imbalance
between strong demand and limited supply in the immediate area, driving up residential
sales and rental values, helping make Knightsbridge the premium address it is today.
Real estate experts have argued that this ‘Harrods Effect’ created the luxury sales and
lettings environment that laid the ground for projects including 15-22 Trevor Square,
Number One Hans Crescent, 199 The Knightsbridge and One Hyde Park. Where Harrods
led, so others followed. However all of this has been mere conjecture and never statistically
analysed or proven. Until now…
In a groundbreaking new report Harrods Estates commissioned Dataloft, in association
with Lonres data, to apply state-of-the-art computer modeling to produce a hot spot map of
sales values and volumes within a 5, 10, 15 and 20 minute walk time from the Harrods
store (see editors notes for detailed methodology). The results prove for the first time the
huge jumps in property value the closer a resident lives to the store; Harrods’ role in
creating Knightsbridge super-prime; the huge appetite for buying properties close to
Harrods; the powerful rental market centred on the famous emporium and the emergence
of a discernable catchment area for Harrods Estates.
Key findings:

There are huge peaks in property prices centred around the Harrods store

The average value for all residential properties sold between 2011 and 2014 within
a 5 minute (360m) walk of Harrods was £2,149 per sqft

This is a 133% price premium over the London average (£921)

It is also a 20% price premium over the Knightsbridge area average (£1,786 - the
average of all properties located within 20 mins walk of the store)

The average price of a property within 5 mins walk of the store is £2.4 million, 94%
higher than the £1.24 million average for the Royal Borough of Kensington and
Chelsea
Key findings:

Residential properties within a 5-10 minute (720m) walk of Harrods have an average
value of £1,969 per sqft

This is a 114% price premium over the London average and a 10% price premium
over the Knightsbridge area average

Close proximity to the store also effects £ per sqft values – an apartment sold within
a five minute walk of Harrods attracts a 14% £ per sqft price premium over those 510 minutes away and a 60% price premium over those 15-20 minutes away

Prestige, exclusivity, resale and rental potential combine to generate a huge global
demand - for properties close to the store

Since 2011 there have been 1,969 homes purchased within a 20 minute walk
(1,440m) of the store

This equates to some £6.13 billion worth of sales since 1st January 2011, or £2.04
billion worth of sales per annum

Since 2011 within a 5 min walk time of Harrods there have been 215 sales in total

Of all sales valued at over £3,000 per sqft within the 20 minute catchment area,
35% were within a 5 min walk time of Harrods

Apartments account for 72% of all sales within a 20 minute walking distance of
Harrods, and 86% of sales within a 5 minute walk of the store (houses accounted for
the balance in both)

The preference for apartments is driven by purchasers, especially those from
overseas, who need a Knightsbridge pied-a-terre or second home, rather than a
large permanent residence

The rental market around the store is extremely strong, both in terms of tenant
demand and rental values – values of £5,000 to £10,000 per week are typical for
smart apartment buildings close to the store
Simon Barry, Head of New Developments at Harrods Estates who commissioned the
research commented: “Some commentators have put the success of the ultra-prime
residential market in Knightsbridge down to what they call the “One Hyde Park” effect.
However One Hyde Park only dates back to 2007 and there has been a premium market in
Knightsbridge for much longer than this.
Simon Barry continues: “Closeness to the open spaces of Hyde Park and the uniqueness of
Harrods are the two main factors which have helped make Knightsbridge a sought-after
address since Victorian and Edwardian times. Grand new houses in Belgrave Square were
the One Hyde Park of their day, and building luxury apartments and houses in the local
area has continued right up to the present day.”
Simon Barry says: “This report has helped to analyse and provide statistical evidence to
support what we’ve known for some time - that ‘super rich’ buyers like Knightsbridge
because of Harrods. However as the findings have demonstrated, being within walking
distance of the only department store of its kind, not only in London but in the whole world has a ripple effect on prices far wider than we previously thought.”
Founded by Charles Henry Harrod, the Grade I Listed department store is both a British
institution and a global icon. With its ornate façade overlooking Brompton Road, Harrods is
one of the most recognisable landmarks in the Capital and will celebrate its 110th birthday
next year. Harrods was the first department store to record over £1 billion of sales and
employs more than 5,000 people. The store welcomes over 300,000 visitors daily across its
330 departments and, with over 1 million sqft of retail space, its importance to London
cannot be underestimated.
The estate agency arm of the store, Harrods Estates has offices in Knightsbridge, Mayfair
and Chelsea, providing an unrivalled VIP service to every one of its customers. Harrods
Estates provides sales, lettings and new development consultancy in Knightsbridge,
Belgravia, Holland Park, Regent’s Park, St John’s Wood, Mayfair, Marylebone, Kensington
and Chelsea.
Shaun Drummond Sales Director at Harrods Estates observes: “Our new report indicates
that Harrods Estates has a clear catchment area centred on Knightsbridge, Mayfair,
Belgravia and Chelsea, with Harrods at the centre. The Harrods Effect map shows that our
customers want to be roughly within a 20 minute walk of the store. Even if some prefer to
make the journey by limousine, the convenience of being able to walk to Harrods is a
luxury, which supports even greater premiums for properties just a few hundred yards
away, or less than 5 minutes walk. Typically these amount to a 27% differential between
Harrods and locations just 1km or just over half a mile further away.”
Harrods Estates has seen consistent demand and a steady increase in £ psf prices paid
for typical apartments in the best buildings: recent sales values include £3,800 psf at The
Lansbury in Basil Street, £4,700 psf at the former Harrods Depository in Trevor Square,
£5,700 psf at 199 Knightsbridge and £6,400 psf at One Hyde Park. Most residents of these
exclusive developments are frequent users of the store and many are valued customers of
Harrods Estates.
To discuss the findings of the new Harrods Effect report and for further information on
homes for sale or letting please contact Simon Barry or Shirley Humphrey at Harrods
Estates on 020 7225 6506 or visit www.harrodsestates.com
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Notes to Editors
Report Methodology: The Harrods Effect
In order to produce the Harrods Effect report, Harrods Estates commissioned Dataloft, the
market intelligence group, to analyse a sample of over 27,500 records of property sales
across Prime Central London from 2011 to 2014 sourced from the Lonres database. The
2011 census middle super output areas were then used to create a fine grain map based
on residential £ per sqft values. In addition, to produce a more detailed analysis Dataloft
also applied a network modeling criteria to an area centred on the Harrods store (sub
postcode SW1X 7XL), in order to produce a hot spot map of sales within a 20 minute
walking distance of the store. This map was based on postcode unit data. The computer
modeling was based on walking accessibility and distance along network lines determined
by Ordnance Survey Vector maps. Once actual distances were measured, walking speed
for the report was assumed as an average of 1.2 metres per second (4.32 kilometres per
hour) to create four concentric time (and geographical distance) based boundaries
emanating outwards from the store. A total of 1969 sales have taken place within a 20
minute (1,440m) walking time of Harrods between 2011 and 2014 and the resulting detailed
analysis in the report is primarily based on the results of the 1969 sales and the walking
boundaries outlined. Knightsbridge area as defined by this report is Knightsbridge, and also
the Knightsbridge border areas of Chelsea, South Kensington, Mayfair and Belgravia. The
majority of sales up to 10 minutes walk of the Harrods store are within Knightsbridge
(SW1X), but over 10 minutes walk, over 80% of sales are outside of SW1X and include the
Knightsbridge borders of Chelsea, South Kensington, Mayfair and Belgravia.
About Harrods Estates
Harrods Estates is the luxury real estate arm of the Harrods Group, specialising in the sale,
letting, acquisition and asset management of some of the most exclusive properties in
central London and prime overseas locations.
The luxury agent is a wholly owned subsidiary of the Harrods Group and offers a discreet,
bespoke, VIP service to each and every one of its clients and customers.
Supported by the strength of the Harrods brand, Harrods Estates has successfully
developed strong brand awareness in key international markets, predominantly Russia, the
Middle East and Asia with the result that international clients now account for 89 per cent of
sales and lettings. In addition to the experienced professionals on the Russian and Middle
Eastern desks, Harrods Estates is able to call upon the skills of the interpreters from all
over the world who are on hand in Harrods.
Harrods Estates recently launched a special Harrods Rewards Points scheme. Harrods
Rewards Points members that sell or purchase or let their property through Harrods Estates
will receive rewards points to spend in the world’s most famous.
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For further please information please contact Lawrie Cornish:
Chanel Patterson
0207 9354084
[email protected]
Alex Lawrie
0207 9354084
[email protected]