Byline: Lisa Lockwood

NEW YORK — He may be closing up shop in Beverly Hills and London, but don’t think Tommy Hilfiger is giving up on retail.
Hilfiger just signed a deal to open his first Manhattan store in SoHo at 372 West Broadway, on the corner of Broome Street, WWD has learned. It will be home to a 12,000-square-foot, three-level building with a large rooftop billboard to be used exclusively by the designer.
The space, which is next to Cipriani’s Downtown, was previously a parking lot.
In other developments, Hifiger’s company is still very involved in talks with Calvin Klein Inc. If there’s a deal, it could happen soon; Klein has set the end of the first quarter as the deadline for a decision.
On Tuesday, Hilfiger held an all-day board meeting, and Calvin Klein was a key topic. Last month, Lawrence Stroll, co-chairman of Hilfiger, was spotted at the Calvin Klein offices, getting a personal tour with Klein, Barry Schwartz and Tom Murry, Klein’s president. Hilfiger’s lawyers have been meeting with Klein’s investment banking firm, but according to sources, Hilfiger officials haven’t been told who’s got the inside track on a deal.
When asked about an acquisition by Hilfiger, a Calvin Klein spokesman said, “The process is continuing apace and going well, as expected.”
Hilfiger officials declined to comment about Calvin Klein.
As reported, Holding di Partecipa-zioni Industriali, the Italian conglomerate, which has all but pulled itself out of the race for Klein, had long been considered the front runner, but its focus has now turned to publishing ventures.
Klein, whose licensed products generate $2.5 billion in wholesale volume, or $5 billion at retail, earns more than $150 million in licensing income. The company hired Lazard Freres last October to explore selling or merging Klein with another group. Bids are believed to have topped $1 billion.
Should a deal be consummated with Hilfiger, sources said, Stroll and Silas Chou — the masterminds behind Hilfiger’s dynamic growth of the past 11 years — would run the Klein business as a separate operation.
Gabriella Forte, former president and chief operating officer of Calvin Klein Inc., has even been up to the Hilfiger offices on several occasions, which led some observers to believe they could put her in charge of the Klein business. But such a move may not sit too well with Klein, as there was some friction between him and Forte near the end of their working relationship.
Hilfiger has retained Morgan Stanley Dean Witter to review “strategic and financial” options, including the possibility of an acquisition and repurchase of company shares.
As reported, the $2 billion Hilfiger company has stalled lately. The firm had its first setback this past quarter, when its third-quarter earnings were up only marginally. Although Hilfiger is still making a lot of money, its growth has slowed considerably, its men’s business has matured and it is undergoing some aggressive cost cutting and consolidation.
Hilfiger announced last month that it planned to close its two enormous — and unprofitable — flagship stores in Beverly Hills and London in the next six to 12 months. Hilfiger has postponed its better-priced career collection, due in stores for fall 2000.
Hilfiger says he will close the Beverly Hills and London flagships when he finds new stores to replace them. The company’s new approach to retailing focuses on building specialty stores of around 10,000 square feet instead of creating 20,000-square-foot publicity vehicles.
“These stores were our marketing vehicles, but now the intention is to relocate them so they will be profitable,” a spokeswoman said last month. When the firm announced the closing of the flagships, it said it planned to open stores with smaller specialty formats in the same cities, but in areas that cater to a “younger, hipper crowd.”
“The average age in Beverly Hills is probably 50,” said Hilfiger Wednesday, clearly excited about his new SoHo store. “In SoHo, the average age is in the 20s. We think the location is triple A, and it’s exposed from Broome and West Broadway.
“We looked extensively for space in New York City, but nothing was right for us until now,” Hilfiger added. “West Broadway is not only an ideal location in the heart of the very modern and energetic SoHo scene, but one that we will design from top to bottom, inside and out. It was well worth the wait.”
Naomi Leff of the architectural firm Naomi Leff Associates will design the building’s facade and structure. An August 2000 groundbreaking is scheduled. The store, slated for a fall 2001 opening, will occupy the building’s street level, basement and first floor. It will have 9,000 square feet of selling space, and will house the women’s and men’s lines, Tommy Jeans, junior jeans and junior sportswear and select accessories.
Currently Hilfiger operates three flagship stores — in Beverly Hills, London and Hong Kong — 45 stores in South America and Mexico City, three specialty stores in the U.S. and 14 specialty stores in Europe.
Hilfiger said plans for the SoHo store didn’t preclude his opening an uptown store, which he has been searching for for years.
“We’ll do an uptown one, but not as big as the 20,000 square feet we planned. We’ll do one in the 10,000-square-foot range, if we find a great location.”

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