Lots of luxe: Luxury stores keep opening in Manhattan, but will their economic gamble pay off?
By Danielle Sonnenberg
Special to amNewYork
When Diesel moved into its flagship store last month on Fifth Avenue, the purveyor of high-end jeans seemed to be saying: Let them eat steak.
Models chowed down on beef in its window, a show of luxurious solidarity against these considerably unflashy times.
Indeed, Diesel and other tony brands are still expanding in the city despite slumping retail sales. In fact, some retail observers said that now is the time for healthy brands to capitalize on sagging rents, but others insist its a fools mission.Chrome Hearts is among the high-end brands taking the plunge. It opened its eyewear store on Madison Avenue in November, and the owner, Larry Sands, said he wouldnt change a thing.
What I did took no guts. We are right on track. We look at the numbers every day and we are shocked. Someone recently spent $21,000 on sunglasses in one day, he said.
If sales at Sands store are as sunny as he says, then Chrome Hearts seems to be the exception. He opened amid a number of closures on his stretch of Madison Avenue.
In the Meatpacking District, British designer Matthew Williamson recently opened his first boutique U.S. store in a ginormous space, with an outdoor garden that resembles a rain forest, sales rep Candy Montijo said.
While its slow going, Montijo said, I feel like were going to kick ass.
In SoHo, another European import, Bang & Olufsen, moved into its flagship space, where it sells home-entertainment systems that can cost upward of $50,000.
Had it been today I cant tell you what we would have done. We are where we are and we are making the best of it, said Kim Gravesen, head of retail division of Bang & Olufsen.
At least landlords are negotiating better deals and rates are down a third across the city, according to Faith Hope Consolo, the head of the retail leasing division at Prudential Douglas Elliman.
Consolo called this one of the best times in retail history to sign leases.
On Fifth Avenue yesterday afternoon, foot traffic appeared heavy, but few customers were entering the recently opened Fifth Avenue retail palace.
Boris Grande and Brook Stevenson, art students at the New York Institute of Technology, were inside just looking.
$145 for a scarf is a little too much for me, Grande said.
Stores like it are not just about how much money they bring in, Consolo said.
Flagships have no relativity to the market, theyre not solely in business to make retail sales, they are making statements, she said.
Even still, a number of stores have backed out of plans to come here, such as high-end watchmaker Hublot, and fashion stores Scoop and Intermix, she said.
Not everyone is proclaiming this the time to conquer New York.
I dont think there is a way [for stores] to take advantage of this economy. The luxury space is horrendous given what happened to the finance industry which drives our city, said Howard Davidowitz, chairman of Davidowitz & Associates, a retail-consulting firm.
As for Armanis bold new store? Opening it, Davidowitz said, was akin to suicide.
Garett Sloane contributed to this report.
Stores either recently opened or scheduled to open this spring:
Lalique: 609 Madison Ave.
Armani Collezioni: 601 Madison Ave.
Giorgio Armani: 717 Fifth Ave.
Diesel: 685 Fifth Ave.
Chakra: 663 Fifth Ave.
Matthew Williamson: 415 W. 14th St.
Ports 1961: 3 Ninth Ave.
Vince: 833 Washington Street at Little West 12th Street
Thom Brownes Black Fleece from Brooks Brothers:
351 Bleecker St.
NYC Timberland: 474 Broadway
Topshop: 478 Broadway
Escada: 560 Broadway
(Prudential Douglas Elliman)