Mulberry to exit Paris store, but will open new location when tourism re-starts
Luxury group Mulberry said on Tuesday that its wholly owned French subsidiary is to end the lease of its store at 275 Rue Saint Honoré and exit the property early.
The move will raise significant cash for the company, but it doesn't mean the label is turning its back on Paris permanently. In fact, Mulberry said that it plans to open a new store in the key shopping city "once International tourism returns". The aim here will be to find a property that "supports the company’s omnichannel approach and optimises its customer-centric retail experience”.
So how much will the property generate for the business? Mulberry said that the book value of it in its accounts was £7.9 million but the process that will complete during September should generate £13.2 million. The net proceeds after tax should be around £10.8 million. It didn't say who might be taking over the property in its place.
This money will "strengthen further the company’s cash position and support investment opportunities in line with its strategic plans", it explained.
It’s perhaps an unsurprising decision taken by the company given how expensive shops in prime retail positions and key destination cities are, and also how much of a drain on company finances they've been in the last 15 months given enforced temporary closures.
Many companies seeking new properties post-pandemic could be expecting to get more attractive rent deals than they may have had previously and that could be another explanation behind the decision to shut the store.
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