Kering, the parent company of Gucci, made headlines on Monday with its acquisition of a prime Fifth Avenue retail property for an impressive $963 million. This move potentially hints at a shift for rival fashion house Armani from its flagship location. The 115,000 square-foot, three-level retail space at 715-717 Fifth Ave., positioned at the base of the iconic Corning Glass Building, is now part of Kering’s expanding portfolio.
This significant retail sale marks Jeff Sutton’s third major success on Fifth Avenue in less than a month, following Wharton Properties’ sales of 720 Fifth Ave. and 724 Fifth to Prada for a total of $835 million. Gucci’s strategic purchase aligns with Kering’s real estate approach to securing prime locations for its renowned brands.
The acquisition reflects the continued prosperity of the “World’s Greatest Shopping Street,” with major retailers such as Prada, LVMH, Rolex, and Harry Winston already investing in Midtown Fifth Avenue properties. Cushman & Wakefield retail power-broker Joanne Podell highlights the trend of foreign companies dominating these purchases, driven by their preference for long-term interests in retail properties, avoiding lease expiration concerns.
The impact of the sale on the current tenant, Armani’s boutique and restaurant at 717 Fifth, remains uncertain, as does its effect on Gucci’s flagship at Trump Tower across the street. Dolce & Gabbana also holds a significant presence in the location. Kering’s diverse lines, including Saint Laurent, Balenciaga, and Alexander McQueen, further strengthen its influence in the fashion industry.
Armani’s lease at 717 Fifth, signed in 2007, is reportedly expiring soon. The renowned fashion house plans to open a new store and restaurant at 760 Madison Ave., in collaboration with SL Green for a Giorgio Armani-branded condo tower. SL Green, a 10.9 percent minority partner in the Fifth Avenue property, considers this disposition another successful investment with Jeff Sutton, underscoring the sustained demand for well-located assets across investment cycles.