Uniqlo

Fast Retailing’s Tadashi Yanai has added another prime European asset to his growing real estate holdings with the acquisition of a historic Milan commercial building for over €300 million.

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The Cordusio 2.0 property, which serves as Uniqlo‘s Italian flagship location, represents Yanai’s latest strategic move into high-value retail real estate across Europe’s major shopping districts. The transaction with seller Hines delivered a 3.5% yield on the 15,700-square-meter asset.

Yanai’s appetite for European commercial properties has accelerated significantly, with three major acquisitions in key markets over recent months. His investment strategy appears focused on securing long-term control of strategic locations where his Uniqlo brand maintains flagship operations.

The Milan building’s transformation from a largely empty 19th-century structure into a mixed-use commercial destination exemplifies the kind of repositioning opportunities attracting global capital. When Hines originally purchased the property in 2016 for German pension fund Bayerische Versorgungkammer, the building required comprehensive renovation to unlock its potential.

Beyond housing Uniqlo’s three-floor Italian debut store, the revitalized property now accommodates premium office tenants including Bain & Company’s regional operations center. The ground-level retail mix features established brands like Champion alongside innovative concepts that blend dining and fashion retail.

The acquisition pattern suggests Yanai is building a portfolio of trophy assets in Europe’s most competitive retail corridors. His previous purchases include properties in Amsterdam’s shopping district and London’s Covent Garden area, both similarly anchored by Uniqlo locations.

For institutional sellers like Hines, the appeal lies in partnering with buyers who understand retail real estate fundamentals while offering premium pricing for assets in prime locations. The transaction was facilitated by JLL’s advisory services.

The deal reflects broader trends in European commercial real estate, where strategic buyers with operational expertise in retail are increasingly competing with traditional institutional investors for the most desirable assets.

Source: Monitor Immobiliare

Japanese apparel titan Uniqlo is doubling down on its New York City presence, announcing a deal to take full ownership of its flagship store on Fifth Avenue. The move underscores a broader trend among major retail brands seeking to control their own real estate in the world’s premier shopping district.

Uniqlo is executing a two-part transaction to acquire the property. First, the company is buying out the stake held by a retail joint venture between Vornado Realty Trust and an unnamed partner. Vornado, which owns a 52% interest in the venture, will net $340 million from the sale of its portion.

Uniqlo is then purchasing the remainder of the property from Brookfield Properties, which owns the larger 39-story office building at 660 Fifth Avenue that houses the Uniqlo store. Terms of the Brookfield deal were not disclosed.

The transactions, expected to close by Q1 2025, underscore Uniqlo’s confidence in the long-term prospects of its New York flagship. The 90,732-square-foot store, located between 52nd and 53rd Streets, has been a crucial driver of the brand’s U.S. expansion since opening in 2011.

Uniqlo’s move follows a string of high-profile retail real estate plays on Fifth Avenue. Luxury giants Prada and Kering have also recently purchased properties along the iconic shopping corridor, seeking greater control over their flagship store experiences.

For Vornado, the sale allows the real estate investment trust to pay down $390 million in preferred equity on the 666 Fifth Avenue property. The REIT will retain ownership of several other retail assets along Fifth Avenue through its joint venture.

The transactions come as New York’s retail market shows signs of a post-pandemic rebound, bolstered by a resurgence in tourism and office occupancy. Vornado reported a rise in its New York retail occupancy rate to 77% in the second quarter, up from 75% a year earlier.

Uniqlo’s strategic real estate play underscores the brand’s long-term confidence in the Big Apple. By owning its marquee Fifth Avenue location outright, the company positions itself for continued growth in the world’s premier shopping destination.

Source: CoStar News
Photo via Unsplash | Yoav Aziz