Luxury brand Mulberry has recently announced that it will be ending the lease of its store located at 275 Rue Saint Honoré in Paris and will be vacating the property earlier than planned. However, this move does not indicate a permanent departure from the city for Mulberry. The company has expressed its intentions to open a new store in Paris once international tourism resumes, prioritizing the search for a location that aligns with its omnichannel approach and enhances the overall customer experience.
By exiting the current store, Mulberry expects to generate a significant sum of cash. While the property has a book value of £7.9 million, the process of terminating the lease is estimated to generate £13.2 million. After taxes, the net proceeds are expected to amount to £10.8 million. Currently, Mulberry has not disclosed who will be taking over the property.
This decision to exit the store will bolster Mulberry’s cash position and provide support for strategic investment opportunities. It is a practical choice considering the high costs associated with prime retail locations and the financial challenges caused by temporary closures over the past 15 months. As numerous companies seek new properties in a post-pandemic world, Mulberry may have the opportunity to secure more favorable rental deals.
In conclusion, Mulberry’s decision to depart from its current Paris store is a temporary measure that is in line with the uncertainties faced by the global tourism industry. The brand remains dedicated to the Paris market and plans to reopen a new store once international tourism resumes, ensuring that it can continue to deliver a premium retail experience to its valued customers.
Useful links:
– Mulberry Official Website
– Reuters: Latest News
