The “For Sale” sign is posted on Kering’s properties. Gucci’s parent company continues its strategy of divestment to deal with debt. And now it plans the (possibly partial) sale of the building on New York’s Fifth Avenue purchased just over a year ago.
The debt picture
That Kering is seeking liquidity is no mystery. Its net debt rose to 10.5 billion euros at the end of 2024, up from nearly zero three years earlier. This was caused by a series of purchases (about 4 billion euros in total) of luxury properties in New York, Milan, and Paris. And at the same time, it experienced a slump in revenue due to the negative performance of luxury and especially Gucci, its main brand.
The building on Fifth Avenue
According to Reuters, Kering is in exclusive negotiations with takeover group Ardian to sell a stake in the $1 billion Fifth Avenue property. The prestigious building (715-717 Fifth Avenue) was purchased in January 2024 for $963 million. The property covers more than 10,700 square meters and consists of several stores. It is uncertain whether Kering is in negotiations to sell the entire property or a portion of it. As a result, the value of the possible transaction is also uncertain. Private equity firm Ardian has already done business with Kering earlier this year, buying shares in three prime real estate properties in Paris.
The intentions
Deputy CEO Jean-Marc Duplaix said in early 2025 that Kering plans to raise 2 billion euros or more in the next two years through property sales. “We continue to work not to resell these assets, but to sell a part of them and have a co-shareholder,” he told shareholders. The for sale sign is posted on properties on Via Montenapoleone in Milan, on Fifth Avenue in New York and in Tokyo.
Photo from Shutterstock
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