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New York

Valentino settles Fifth Ave pandemic rent dispute

Luxury retailer had sued to exit 15-year lease, citing Covid

Valentino store at 693 Fifth Avenue in Manhattan and Valentino CEO Jacopo Venturini (Google Maps, Getty)
Valentino store at 693 Fifth Avenue in Manhattan and Valentino CEO Jacopo Venturini (Google Maps, Getty)

Valentino fled for Soho more than a year ago, but only now is the retailer putting its Fifth Avenue struggles behind it.

The high-fashion boutique settled a lease dispute with its landlord at 693 Fifth Avenue, the Commercial Observer reported. Terms were not disclosed, but Valentino called the settlement “amicable.” It did result in the termination of the brand’s lease.

Valentino sued in June 2020, looking to terminate its 15-year lease at the four-story retail store. Its complaint mentioned “Covid-19-related restrictions,” as well as the growing threat of e-commerce to the building.

The landlord, French holding company Financière Marc de Lacharrière, fought back. According to the Observer, a judge ruled in January 2021 that Valentino still needed to pay its rent. The pandemic did not change that obligation, according to New York State Supreme Court Judge Andrew Borrok.

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“No wrongful act of the landlord is alleged to have caused the necessity of this decision,” Borrok ruled, noting Valentino stayed open for curbside delivery and appointments.

The landlord then filed a lawsuit of its own, accusing Valentino of ditching its lease eight years and about $200 million early. Valentino left in December 2020.

It’s a bittersweet ending for both sides after Valentino started its lease in 2013 with Thor Equities. The developer sold the building to Lacharrière in 2016 for $525 million.

Despite arguing that Fifth Avenue was not viable for its operation, Valentino hasn’t left the city. While its lawsuit was being waged, the brand signed a two-year deal to open its first Soho store, taking nearly 8,800 square feet in a duplex at 135 Spring Street.

Early in the pandemic, Valentino also expanded its presence in Dallas, adding almost 700 square feet to its 2,500-square-foot boutique in Highland Park Village.

[CO] — Holden Walter-Warner

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Commercial Real EstateFifth Avenue RetailReal Estate LawsuitsRetailRetail Real Estate