Saks Fifth Av­enue Finds New Ad­dress in Delhi’s Ae­roc­ity

Ul­tra luxe re­tailer said to have ap­pointed Aditya Birla Fashion as its In­dia fran­chisee

The Economic Times - - Companies: Pursuit Of Profit - Ra­sul.Bailay@ times­group.com

New Delhi: Ul­tra-lux­ury re­tail busi­ness in new-age In­dia will be founded on old money. North Amer­ica’s old­est com­mer­cial firm is now part­ner­ing the Aditya Birla Group, whose ori­gins date back to 1857, to start Saks Fifth Av­enue out­lets in a coun­try that once boasted of the posh­est store east of the Suez.

Hud­son’s Bay-owned Saks, which com­petes with Macy’s and Kohl’s for cus­tomers of de­signer or lim­ited-edi­tion footwear, cloth­ing, and ac­ces­sories, will help In­dian shop­pers live the Fifth Av­enue ex­pe­ri­ence in New Delhi’s Ae­roc­ity, ac­cord­ing to three peo­ple fa­mil­iar with the de­vel­op­ment. Saks has ap­pointed Aditya Birla Fashion and Re­tail as the In­dia fran­chisee and the first out­let is ex­pected to come up in Bharti Realty’s World­mark 2, said one of the per­sons with di­rect knowl­edge of the ne­go­ti­a­tions.

“Aditya Birla Group is in a late stage of dis­cus­sions” to lease 100,000 sq ft of space in World­mark 2, where the first Saks out­let in In­dia will open, he said. The Aditya Birla group is also scout­ing for space in Mum­bai for the sec­ond Saks depart­ment store there.

Hud­son’s Bay, founded in 1670 by the English Royal Char­ter and a fur trader for many years of its com­mer­cial ex­is­tence, will help In­dia re-live at home the multi-brand pre­mium shop­ping ex­pe­ri­ence that drives cus­tomers on trips to shop­ping mec­cas like Dubai, Lon­don, Sin­ga­pore, or New York. In­dia’s own ver­sion of Har­rods, White­away Laid­law, faded into in­signif­i­cance after in­de­pen­dence. Orig­i­nally lo­cated on the Met­ro­pol­i­tan Build­ing in down­town Kolkata, White­away & Laid­law was once the class bench­mark for depart­ment stores op­er­at­ing in Asia.

For the Saks ven­ture, CBRE is act­ing as a real-es­tate con­sul­tant, ac­cord­ing to two peo­ple cited above. CBRE did not re­spond to an email sent on Fri­day. The sec­ond per­son added that Saks could open the first store later this year or early next year, de­pend­ing on how the ne­go­ti­a­tions pro­ceed.

A spokesper­son for Aditya Birla Fashion de­clined to com­ment say­ing the com­pany does not com­ment on “mar­ket sto­ries.” Saks did not re­spond to an email seek­ing com­ments while a spokesper­son for Bharti Realty de­clined to com­ment.

Saks’ flag­ship out­let on the Fifth Av­enue in Man­hat­tan in New York is be­lieved to gen­er­ate about $700 mil­lion an­nual busi­ness for the com­pany. Saks has been in talks with Aditya Birla for more than two years, ac­cord­ing to sources.

In New Delhi, Saks store will compete with DLF’s lux­ury mall Emporio, that is home to sin­gle-brand lux­ury stores of Louis Vuit­ton, Her­mes, Gior­gio Ar­mani, and Gucci.

Bharti Realty’s mix-land de­vel­op­ment World­mark has over 1.4 mil­lion sqft com­mer­cial and re­tail space, con­sist­ing of about 900,000 sqft of of­fice space and 500,000 sq ft of high-end re­tail space. The fa­cil­ity also houses Kishore Biyani-owned Cen­tral mall that is spread over 100,000 sq ft.

Aditya Birla Fashion owns var­i­ous brands in­clud­ing Louis Philippe, Van Heusen, Allen Solly and Pan­taloons depart­ment stores, among other la­bels. In May 2015, Aditya Birla Group had merged its units Madura Fashion division, Pan­taloons Fashion & Re­tail and Madura Gar­ments Life­style Re­tail to cre­ate Aditya Birla Fashion and Re­tail Ltd.

ANIR­BAN BORA

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