By  on April 25, 2008

Donna Karan and her daughter, Gabby Karan DeFelice, are going into business side-by-side in Sag Harbor, N.Y.

Karan plans to open her second Urban Zen boutique, and next door, De Felice and her husband, Gianpaolo DeFelice, have bought an interest in the Italian restaurant coowned by the late Steve Florio at 6 Bay Street.

"Gabby is designing the restaurant and working on the [decor of the] store," Karan said Thursday. She said the restaurant has been operating "quietly," but will have an official reopening with a new chef on Memorial Day weekend, coinciding with the unveiling of the Urban Zen boutique.

The DeFelices are partners in the restaurant with Larry and Maria Baum (who coowned it with Florio and his wife, Marianne), and David and Gally Mayer.

Karan signed a one-year lease for the 2,000-square-foot store (plus a garden), which she plans to keep open year-round. Urban Zen, which already operates a unit in Manhattan at 705 Greenwich Street, will feature the women's and men's Urban Zen Collection, accessories, jewelry, beauty products and books, as well as an art gallery.

The restaurant and the Urban Zen boutique are in different buildings separated by the garden, which will have furniture from Bali. "It's an amazing outdoor space," Karan said.

The Urban Zen collection and retail unit are independent of Donna Karan International. A portion of the profits from the store will go to Karan's foundation and to Urban Zen's programs, which focus on well-being, preserving cultures and empowering children. Karan, along with Demi Moore and Ashton Kutcher, will host a Spirituality for Kids forum May 3 to 5 at the Stephan Weiss Studio in Manhattan.

The Urban Zen space and collection tap into Karan's more spiritual holistic interests, and the store will carry artifacts she has gathered from around the world.

When Karan opened the first Urban Zen in Manhattan last year, she told WWD, "The store truly represents the complete concept of Urban Zen, touching a person by its coziness, its comfortable-ness, its caring-ness, its simplicity, its sensibility of people today and how they want to have objects of desire.""We're taking New York out to the Hamptons," said Karan, who noted that last year Urban Zen did a pop-up store in Sag Harbor.

Karan said she's scouting several other Urban Zen locations in the U.S. and is negotiating for a space between Melrose Avenue and Robertson Boulevard in Los Angeles. She also plans to open a store in Sun Valley, Idaho. Stephen Ruzow, a former president of Donna Karan International and former president of the Calvin Klein bridge and better women's sportswear division at Kellwood Co., has been consulting with Karan on the Urban Zen business, she said.

Karan, who has a house on the same street as her daughter in East Hampton, N.Y., said she has "a funny feeling" she'll be spending a lot of time this summer at the boutique and the restaurant. She said her yoga class is in the same area, which she goes to "every morning."

"This is so Gabby and me," said Karan, referring to the combination of an Italian restaurant and a clothing boutique. "It will be a home away from home."

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