NEW YORK — It’s been more than a year since Gucci closed its doors at 840 Madison Avenue here and parent Kering still hasn’t divulged its plans for the 10,298-square-foot space. Gucci holds the lease and has the right to sublet through September 2018, according to real estate sources.
Persistent reports have Kering installing Gucci sister brand Balenciaga in all or part of the store. When asked whether Balenciaga will open at 840 Madison Avenue, a spokeswoman at the brand’s Paris office didn’t deny the possibility, but said it was too early to talk about any plans.
Real estate brokerage RKF is subleasing the former Gucci site on Madison Avenue between 69th and 70th Streets. The bi-level store has 2,801 square feet on the ground floor and 7,487 on the balcony. RKF noted that the space can be divided into two units, each with 1,400 square feet on the ground floor.
Reportedly, finding a tenant has been difficult. Madison Avenue has suffered from a surfeit of empty storefronts in recent years. High asking rents are one reason, according to experts. However, the rise in inventory in the fall encouraged landlords to lower their asking rents by 11 percent to $1,433 a square foot, from $1,613 a square foot the previous year.
Asking rent for the retail space at 840 Madison Avenue is $1,400 a square foot for the ground floor and $200 a square foot for the second level. Neighboring stores include Chloe, Prada, Cartier, Dolce & Gabbana and Proenza Schouler. The location is steps from the new The Met Breur, which recently celebrated its first anniversary.
“I suspect that they put it on the sublet market and didn’t get any bites,” said a real estate source, adding that the mid-block address is “meh.”
With Kering on the hook for the remainder of the lease, the company may see 840 Madison Avenue as an inexpensive way to experiment with a Balenciaga store uptown since the former Gucci space wouldn’t require a costly buildout. Balenciaga operates a store in SoHo. The brand’s price points are well-suited for Madison Avenue.
“It’s a very busy time on Madison Avenue with some new openings in the last few weeks,” said Matthew Bauer, Ph.D., president of the Madison Avenue Business Improvement District, citing new stores from Elie Saab at 860 Madison Avenue, Caudalie at 819 Madison Avenue, and Edie Parker, No. 781.
“We’re expecting a lot more new names. A lot of buildings have gone through some changes,” Bauer said, mentioning Bottega Veneta, opening soon at 740 Madison Avenue, Tom Ford moving to No. 680 and Max Mara “undergoing a complete redo at 813. There are certainly vacancies on Madison Avenue. But the avenue is so large, it goes from 57th to 86th Street. With a district this size, you’ll see different pockets and changes. It’s still about the residential neighborhood that it interacts with.”
Kering’s large portfolio of brands includes Saint Laurent, Alexander McQueen, Stella McCartney, Bottega, Boucheron, Brioni and Pomellato, among others. While Saint Laurent, for example, has a developed store network with units on East 57th Street and SoHo’s Greene Street, it’s conceivable that Kering would divide the former Gucci space into two stores for Balenciaga and another brand that might be a fit for part of the 840 Madison Avenue retail space.