The French company Kering, parent company of Gucci, Saint Laurent, Balenciaga and Bottega Veneta, has purchased a building on one of the most sought-after streets in Milan for 1.3 billion euros, as announced this Thursday to the market.
The company buys from Blackstone number 8 via (street) Monte Napoleone, “located on the most prominent corner of the Quadrilatero della Moda”, one of the most expensive streets in the world where the stores of the main brands on the planet are concentrated. The operation is the largest of its kind seen in Italy, they point out from Blackstonte.
The building dates back to the 18th century and has about 11,800 square meters distributed over five floors. About 5,000 are for commerce, one of the largest areas in the area. It is currently occupied by boutiques from Prada, Saint-Laurent or the famous Cova pastry shop, owned by Kering competitor LVMH, which will continue as a tenant.
“This investment is part of Kering’s selective real estate strategy, which aims to secure key and highly desirable locations for its businesses,” the company comments in a note. “Kering continues to focus on proactively managing its real estate portfolio with the short and medium term objective of retaining a stake in its core assets,” it added in the statement.
Kering will only buy “exceptional” buildings in a limited number of cities if they create value for the group’s brands, deputy chief executive Jean-Marc Duplaix said in February.
At the beginning of the year it already acquired a building on Fifth Avenue in New York for 885 million euros. The group’s goal is to own up to 15 buildings, Duplaix stated at the time. “We’re talking about about 1% of our network.”
Despite the operations, in March it warned that it expects a drop in its comparable income in the first quarter, including a sharp decline in sales of Gucci, its main brand, especially in the Asia-Pacific region.