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Billionaire Cheng family in talks with Louis Vuitton on mega Hong Kong store

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Bloomberg

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March 17, 2025

New World Development Co., the Hong Kong real estate company controlled by the billionaire Cheng family, is in talks with luxury giant Louis Vuitton to open a mega store in one of the developer’s signature malls, according to people familiar with the matter.

Louis Vuitton – Fall-Winter2025 – 2026 – Womenswear – France – Paris – ©Launchmetrics/spotlight

The new store would occupy about 40,000 square feet at the K11 Musea mall, making it one of Louis Vuitton’s largest in Asia, said the people, who asked not to be identified discussing private matters. The store could feature a museum, a cafe and a lounge for the brand’s VIP customers, they said. Details over rent remain unclear. 

Discussions are at an advanced stage, but details could still change and the deal could still fall apart, the people said. 

New World didn’t immediately respond to a request for comment. A spokesperson for LVMH declined to comment.

If an agreement is reached, the expansion of fashion conglomerate LVMH’s largest brand would inject some confidence into Hong Kong’s retail industry and help its ailing commercial property sector. It would also be a boost for New World, which has been struggling with debt woes and uncertainty over its leadership. 

Located near the city’s famous Victoria Harbor and with a fashion-forward design incorporating arts and culture elements, K11 Musea is a popular destination for tourists. Its exclusive private members clubs have also attracted a group of wealthy clientele through the Cheng family’s networks. 

LVMH’s plan to open a mega store in one of Hong Kong’s most upscale shopping malls, with significant space reserved for non-retail and VIP elements, underscores luxury brands’ efforts to wring more growth from the ultra-rich at a time when China’s economic slowdown has sapped demand for discretionary consumption among middle-class shoppers. Fashion houses are designing more unique shopping experiences to develop personal connections with customers, and are focusing more on clients less affected by the downturn.

While Hong Kong has been suffering from declining retail sales and a slow recovery in tourism, the city has the highest concentration of millionaires in the Greater China region and ranked No. 9 on a list of wealthiest cities in the world, according to a report published last year by investment migration company Henley & Partners in partnership with intelligence firm New World Wealth.

K11 Musea is accelerating its pivot to luxury shopping with Prada SpA opening a new store in the mall and other high-end labels, including LVMH’s Loewe and Kering SA’s Saint Laurent and Balenciaga upgrading their facilities. The mall also hosted Louis Vuitton’s first ever fashion show in Hong Kong in 2023. 

Facing mounting pressure over its debt burden, New World has proposed pledging some of its most-prized properties valued at a total $19.1 billion, in order to refinance its loans, Bloomberg News reported earlier this year. K11 Musea, located on a site where the Cheng family has owned properties since the 1970s, is seen as a heritage asset for the clan. The family is the center of an ongoing succession saga with patriarch Henry Cheng saying he was still looking for someone to take charge of the family business.



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Russia’s Alrosa diamond producer says it has paused production at less profitable mines

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Reuters

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March 18, 2025

Russian diamond producer Alrosa announced on Tuesday that it had decided to temporarily suspend operations at its less profitable deposits.

Reuters

The suspension will affect deposits with an annual production of less than 1 million carats, it said.
The company said it still planned to produce 29 million carats of diamonds in 2025.

In November 2024, Alrosa said that it might suspend some production in 2025 and reduce staff.

© Thomson Reuters 2025 All rights reserved.



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Dolce & Gabbana looks beyond fashion to safeguard independence

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Bloomberg

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March 18, 2025

Dolce & Gabbana Srl, the Italian fashion house known for bold, Mediterranean-inspired designs, says its beauty business now holds the key to an independent future in the rapidly shifting luxury industry.

Dolce & Gabbana – Fall-Winter2025 – 2026 – Womenswear – Italie – Milan – ©Launchmetrics/spotlight

Revenue from beauty products is expected to rise more than 20% for the 12 months through the end of March 2025, to €610 million ($665 million), Chief Executive Officer Alfonso Dolce said in an interview. That would lift total annual revenue to around €2 billion.

The company is also targeting €1 billion in beauty sales by the end of the 2027 financial year, following a shift from licensing to direct management of production and distribution of fragrances, makeup and skincare.

Dolce Gabbana’s pivot on beauty comes at a fraught moment for the fashion sector, where a global slump has raised questions about the standalone future of some of its rivals. 

Hong Kong-listed Prada SpA is nearing a deal to buy Gianni Versace Srl, while fashion icon Giorgio Armani rocked the industry last year when he said he no longer rules out a merger or listing once he exits the scene.

Dolce Gabbana’s reaction has been to double down on its independence by broadening its revenue streams. Along with the decision to directly manage the beauty business, it’s also testing the waters in real estate and hotels.

“We asked ourselves, what more do we have to say to the fashion industry after 40 years at the top?,” said Dolce, 60, who holds the top job at the firm his brother Domenico and Stefano Gabbana founded in 1985. 

Dolce Gabbana Holding Srl, which encompasses the group’s offerings in clothing, furnishing accessories and beauty, reported about €1.9 billion in revenue for the 12 months through March 2024, up 19% at constant exchange rates compared with the previous year, driven by an almost five-fold increase in beauty. 

But the company’s earnings before interest and taxes are still just a fraction of its Italian rivals. Dolce Gabbana posted €4 million in Ebit at the end of the last financial year, compared with €1.28 billion for Prada on sales of €5.4 billion. 

The jury is still out on the firm’s other big diversification bet, property and hotels.

“The success in beauty is a good testament of the brand strength,” said Luca Solca, a senior analyst at Bernstein.  “I don’t think that hospitality/hotels will play a big role for them.”

The firm is seeking additional funding, including for its real estate ventures, which cover residences in Marbella, Spain, in Miami and in Dubai, as well as hotels in the Maldives and Saudi Arabia.

That’s another change in tack for a group that’s traditionally financed investments internally, Dolce said. A €300 million term loan that’s about 25% repaid dates back to 2022. The fashion house also has a €100 million working capital facility. 

It’s now in talks with bank lenders for as much €150 million. A decision by those creditors is still on hold.

The diversification moves were prompted by what the CEO acknowledged was over-reliance on visitors to the Mediterranean, and the group’s post-Covid rebound was short-lived, he said.

The 2022 Russian invasion of Ukraine shaved off more than €100 million from the top line, while sales to Chinese customers tumbled as the country’s economy dipped and consumer tastes shifted.

Still, Dolce insists his firm can thrive as an independent. “If the macroeconomic environment deteriorates further, we have our own properties, our warehouses and we can always cut ad spending, which is twice as high as our peers,” he said.

Dolce also remains adamant about not wanting outside investors, at least for now.

“We listen to everyone, investment banks, family offices, private equity firms,” the CEO said. “But our response is always the same, at the moment we’re not interested in opening our capital.”
 



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LilySilk launches capsule collection with stylist Elizabeth Stewart

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Silk brand LilySilk has teamed up with Hollywood stylist Elizabeth Stewart to launch a capsule collection.

LilySilk launches capsule collection with stylist Elizabeth Stewart. – LilySilk

“We’re excited to unveil our exclusive collaboration with Elizabeth Stewart, the celebrated Hollywood stylist known for her exceptional eye for elegance,” said David Wang, CEO of LilySilk. 

“This partnership redefines the essence of effortless sophistication and timeless allure, merging LilySilk’s luxurious silk with Elizabeth’s unmatched styling artistry.”

The collection combines LilySilk’s commitment to sustainable luxury with Stewart’s signature styling expertise. It features six curated looks with 11 versatile pieces, rooted in luxury, comfort, and sustainability. 

Among them is the Denim Dossier, a fitted denim-inspired suit with a cropped jacket and high-waisted wide-leg pants. Urban Voyager offers a modern take on leisurewear with an oversized bomber jacket and jogger pants, while Versatile Vogue pairs a refined sweater with a satin skirt. 

Modern Mosaic presents a bold statement blouse that can be styled with tailored pants for work or jeans for a more casual look. Playful Palette showcases vibrant bowling shirts matched with tailored culottes, and Patchwork Paradise, offers a one-of-a-kind pajama set crafted from deadstock fabrics. 

“I work with many brands, and I’m always seeking out companies that truly consider their environmental impact,” added Stewart. “That’s why I’m thrilled to collaborate with LilySilk—our shared commitment to sustainability and quality makes this collection truly special.”

Earlier this year, LilySilk opened its first-ever U.S. concept store, in the Meatpacking District in New York. 

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