The United States of Luxury

Luxury brands are pivoting their strategic focus back to the United States as the market emerges as a primary growth engine amidst a stagnant recovery in China. Data from Savills reveals that North America led global luxury store openings in 2025, accounting for 27% of the total share as brands expand flagship footprints and venture into secondary markets. This reinvestment is fueled by resilient domestic employment and a strong stock market, which continue to drive confidence and spending among high-net-worth individuals.

The strategic shift toward the U.S. market is largely driven by the failure of the Chinese market to rebound as expected following the pandemic. Eric Fisch, HSBC’s US head of retail and apparel, notes that while the industry anticipated a massive explosion in Chinese demand, the rise of local challenger brands and economic factors have hindered that comeback six years later. Consequently, luxury houses are doubling down on American soil, where solid employment rates and a thriving stock market have created a reliable environment for high-end consumption, making the U.S. a rare bright spot in recent earnings reports characterized by global revenue dips.

Investment is increasingly flowing into the Sun Belt and emerging secondary markets where brands see a high return on investment compared to traditional hubs like Fifth Avenue. Cities such as Charlotte, Nashville, Miami, and Charleston are gaining traction due to a mix of local wealth and rising tourism. In Scottsdale, Arizona, luxury brands like Dior, Brunello Cucinelli, and Hermès are concentrating in Scottsdale Fashion Square to reach affluent retirees and wealthy families who favor a mix of athleisure and high-end accessories. These regional markets offer lower lease rates and high foot traffic, presenting a lucrative opportunity for brands looking to expand their physical footprint beyond the coasts.

In Northern California and Hawaii, brands are tailoring their approach to specific regional demographics and economic incentives. In the San Francisco Bay Area, the focus is on capturing “AI millionaires” and tech elites who are increasingly trading tech-wear for “quiet luxury” styles at locations like Union Square and Valley Fair mall. Meanwhile, Hawaii continues to attract foreign investors and tourists through “Hawaii pricing,” which is often 10% lower than mainland prices, and lower tax rates. Major retail centers like Ala Moana and Luxury Row on Kalākaua Avenue remain essential hubs for brands ranging from Chanel to Bottega Veneta.

The Los Angeles market remains a powerhouse, driven by a diverse consumer base of Hollywood executives, startup entrepreneurs, and high-earning influencers. While Rodeo Drive in Beverly Hills remains the traditional epicenter for luxury, alternative areas like Melrose Place have successfully attracted brands such as The Row and Khaite. The planned reopening of Palisades Village further underscores the industry's commitment to high-end retail infrastructure in the region. This broad-based reinvestment across various American micro-markets reflects a fundamental shift in the luxury sector's global strategy, prioritizing the stability and diverse wealth of the United States.