Opening Soon

I live in downtown Shanghai. In the past two years that I’ve been here I get the feeling my neighborhood is slowly turning into one single luxury shopping mall with a couple of luxury hotels, a streets and office/resident blocks in between. Within a circle of three kilometers around my apartment there are, just to name obvious brands, 4 Guccis, 4 Chloés, 2 Pradas, 2 Balenciagas, 2 Lanvins. (Noted, these are only the ones around my neighborhood. There are many more scattered across the whole city.) Marc Jacobs, a label that has no single store in Germany (and it seems, not much of a market) is opening it’s second one in Shanghai in a few weeks. Other brands for a more distinguished customer crowd like Jil Sander, Alexander Wang and Paul Smith are doing the same. The two Balanciagas for example are only 600 meters distanced from each other.

It has become really scary to bike the ten minutes to my office in the morning – you feel like the cityscape now mainly looks like the advertising pages in Vogue. Opposite some of these malls local noodle place owners and vegetable sellers still run their businesses. The money they make every month, around a few hundred euros, is mostly not even enough to buy an odd shoe on the other side of the street.

Many of the luxury stores don’t even earn profit. Whenever I walked by they seem to be completely empty. There is a heavy tax in China on high-end stuff imported from abroad – all the fashion brands mark up their prices here by 30 percent in comparison to Europe and other places. Who is supposed to buy all that shit? Most nouveau riche Chinese who have the cash to splurge on bling actually don’t: They fly down to Hong Kong (almost no tax there) or directly to Paris or Milan. And yet, international brands in China are opening one place after another like McDonald’s. Mainly as “show rooms”, people in the industry told me. But with rents in Shanghai getting almost as over-the-top as in New York that doesn’t seem to make any sense, also now that the economy is slowing down in China. It’s a mystery to me how that whole thing works.