Owner of Gucci purchases $1.4 billion building in Europe’s largest deal of recent times

Gucci owner Kering just bought a building worth $1.4 billion in Milan’s most exclusive fashion street.

This deal also makes the location Italy’s most expensive building.

Not only that, but it marks the biggest property purchase Europe’s biggest since 2022, and comfortably the biggest ever for the company behind it.

Kering made the purchase to set up operations for its brands on the high-end fashion street.

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The French luxury group bought the building from Blackstone Property Partners Europe.

But what’s so special about this building?

For starters, the Via Monte Napoleone 8 is an 18th-century building.

Moreover, its exclusive location makes it an attractive purchase for luxury fashion brands.

It might not be as attractive as the upcoming world’s tallest skyscraper, but it definitely has its perks.

The building already houses a Saint Laurent store, a Prada store, and the LVMH-owned Cova patisserie.

Talk about entering a luxury building.

The Milan deal can certainly compete with the most expensive purchases made in 2023.

While the Gucci owner’s purchase is quite significant, this isn’t an unusual one.

Luxury fashion brands tend to purchase captivating real estate in such locations to lock down their presence in strategic fashion streets.

When the demand for such exclusive properties is too high, real estate prices start to spiral upwards and upwards.

That is why this building cost the Gucci owner $1.4 billion.

However, they believe it is worth the investment.

“This investment is part of Kering’s selective real estate strategy, aimed at securing key highly desirable locations for its houses,” Kering said.

In addition, the French group only recently purchased another $963 million building in New York.

As you can see, it’s quite normal for luxury groups to make expensive property purchases.

You might say that it’s all part of a bigger game for these luxury groups.

However, this Milan deal is still quite unique in a way.

The building Kering bought has the second-highest rent of any shopping street in the world.

New York’s Fifth Avenue holds the title for having the highest rent.