MELBOURNE has the sixth most expensive prime retail market in the world after Sydney and London, new research from CBRE shows.
Hong Kong, New York and Tokyo top the most-expensive list.
Both Sydney and Melbourne rank above Zurich, Paris and Moscow.
Hong Kong and New York recorded significant rises in prime retail rents during the third quarter of 2012, while the next tier - Tokyo, Sydney and London - held steady.
"Hong Kong and other Asia Pacific markets have benefited from international retailers - particularly fast-fashion, cosmetics, jewellery watch, and mid-range fashion retailers - aggressively seeking prime locations across the region," CBRE chief economist Ray Torto said.
Sydney remains the most popular market for international retailers entering Australia but Melbourne's prime CBD locations were also in strong demand, the group said.
That interest has become more evident this year with several top-tier brands - Thomas Pink, Rhodes & Beckett and TAG Heuer - opening, or planning, new stores in Melbourne's Collins Street.
Rental growth in Sydney experienced a rise in the third quarter, thanks to greater leasing activity, but growth was likely to moderate in the coming months amid weak consumer sentiment, CBRE said. Global retailer activity remains polarised with prime, high-street space in the best markets experiencing the greatest demand, it said.
The scarcity of top-tier prime retail space in both Sydney and Melbourne results in the market giving it a premium and vaults them both into the global ranking.
In New York rents on Fifth Avenue rose 17 per cent quarter-on-quarter as international retailers sought flagship space, where consumers spend on luxury goods and services.