It’s tough to find a positive economic story anywhere in the world right now but one does seem to
exist – in the form of Norway and its capital city Oslo. The Scandinavian location is enjoying
something of a boom time as a destination for a growing number of overseas and domestic
tourists attracted by its healthy environment and burgeoning retail and leisure scene.
At the heart of this is the world’s oldest high-end department store Steen & Strom that is arguably
the fulcrum in the city around which are congregating a growing number of global luxury brands.
Creating this attractive environment for the likes of Hermes, Louis Vuitton and Burberry to open
Nordic flagships is Promenaden, the landlord of Steen & Strom.
Annette Lund, CEO of Promenaden, says there has been much development in Oslo in recent years
and that Steen & Strom [and Promenaden] have been important in bringing luxury to the country:
“Oslo is attracting locals and Norwegian visitors as well as tourists. It’s a hot destination in Europe.
For Steen & Strom it’s good to be the store of Oslo.”
The careful estate management work of the property company has involved accumulating a
portfolio of units, in addition to the department store, concentrated around the city’s premier
luxury street Nedre Slottsgate. This estate encompasses 14 buildings covering a total of 70,000 sq
m of floorspace.
Steen & Strom itself now accounts for six buildings, which represents an increase from when
Promenaden bought the property, and has helped take its footprint up to almost a full block in the
heart of Oslo. The expansion is part of a major $36 million investment in the store that is bringing
some sparkle back to the 225-year-old property.
The store was opened when Oslo had only 19,000 inhabitants – compared with 600,000 today
(from a total of 5.5 million inhabitants in the whole of Norway) – and its offer was focused on
selling wool, cotton and candy. At the time Oslo and Noway was “quite poor”, she says, but this
dramatically changed with the discovery of oil off its coastline in the 1970s.
This injection of money into the store has enabled a major new entrance to be added on Karl
Johans Gate that opened its doors in May 2021 and leads into an impressive atrium with shoppers
passing directly into the beauty hall. Lund says this is a “huge part of the investment and is the
engine room of the whole house”. Indicative of how the area is attracting a broad demographic –
including a young as well as a more traditional luxury audience – is the fact the two best
performing brands in the beauty hall are Chanel and Rhianna’s Fenty Beauty.
The average age of the customer base is 40, which reflects how young customers are attracted to
luxury in the city and also hints at the general affluence within Norway. Lund says the GDP per
capita is an incredible three-times the level found in the rest of Europe. Another focus of the development of the store has been the impressive food hall on the lower ground floor that has dine-in areas for a variety of brands in a lowly-lit environment that enjoys healthy peaks at lunchtime and the immediate after-work crowd. “Food and beverage is an important part of the store alongside retail and accounts for over 20% of sales,” she says.
With Promenaden now owning the majority of properties on Nedre Slottsgate, Kaia Kongli,
marketing manager at Promenaden, says it is upgrading the whole thoroughfare with seating and
planters. This is enticing some brands to move into the street from elsewhere and others such as
Dior to open their first sites in Scandinavia – scheduled for later this summer. It is very much
becoming a destination.
The company is also working on the Eger store, which consists of six properties and sits across the
street from Steen & Strom, with new brands being brought into the mix as the building is
overhauled. This will further enhance the retail proposition in Oslo and create solid foundations
that will enable the city to attract even more visitors and build on the work done by the founders
of Steen & Strom back in 1797.
Glynn Davis, editor Retail Insider