NEW YORK CITY, New York: Luxury group Kering is in exclusive discussions to sell a stake in its prime New York real estate asset on Fifth Avenue, sources told Reuters, as it continues efforts to trim mounting debt and rebalance its portfolio.
According to two people with direct knowledge of the matter, the French owner of Gucci is negotiating with private equity firm Ardian over the potential sale of part of its interest in 715-717 Fifth Avenue, a landmark retail property it acquired in early 2024 for US$963 million.
The talks align with Kering’s broader strategy of offloading stakes in trophy assets rather than full divestments. “We continue to work not to resell these assets, but to sell part of them and have a co-shareholder,” Deputy CEO Jean-Marc Duplaix told shareholders in April, referencing properties in Milan, Tokyo, and New York.
Both Kering and Ardian declined to comment.
The New York building spans 115,000 square feet and sits on one of the world’s most iconic shopping streets. Kering, controlled by the family of CEO François-Henri Pinault, had pursued a buying spree in recent years, acquiring luxury real estate in New York, Milan, and Paris worth nearly 4 billion euros.
By the end of 2024, Kering’s net debt had climbed to 10.5 billion euros ($12 billion), up from nearly zero three years prior. The company has said it expects to raise over 2 billion euros within two years from real estate transactions alone.
In January, Ardian purchased a 60 percent stake in a joint venture that included three Parisian buildings, generating 837 million euros for Kering, which retained a 40 percent stake.
The sources said the Fifth Avenue discussions are similarly focused on a partial stake sale, though declined to disclose the potential size or value of the deal.
Duplaix emphasized that Kering’s continued presence in top global shopping destinations is crucial for its brands, which include Saint Laurent and Balenciaga. Via Montenapoleone in Milan and New York’s Fifth Avenue were named as key assets under review.
According to Cushman & Wakefield, Milan’s Via Montenapoleone was the most expensive retail street in the world in 2024, followed by the upscale stretch of Fifth Avenue.