CATHARINE SMITH, HOST: Most fashion brands have made a point of distancing themselves from former president Donald Trump since he left the White House. But there’s been one notable exception to that trend: Gucci.
KAREN MANIRAHO, HOST: The Italian fashion house announced this week that it has renewed its lease with Trump Tower. Gucci said it struck a deal to remain at 721 Fifth Avenue at a reduced rate. The news sent a ripple of surprise through the fashion industry. Fei Lu reports.
FEI LU, BYLINE: When people think of Fifth Avenue, one word pops up -- luxury. The street is home to multiple designer flagship stores, including Gucci’s. The lease on the nearly 50 thousand square foot space occupied by Gucci was supposed to expire in 2026. This week, parent company Kering Group announced it had renegotiated a new agreement at a discounted rate. Terms were not disclosed.
Gucci’s decision to remain in Trump Tower puts the company at odds with most other big fashion companies, who have moved to distance themselves from the Trump brand. But not everyone thinks Gucci has made a bad move.
THOMAÏ SERDARI: So I think that business decisions should always be based on data and facts and numbers.
LU: Thomai Serdari is the director of NYU’s Fashion & Luxury MBA program. She says Gucci’s move makes good business sense.
SERDARI: If Gucci has managed to negotiate a great lease, this is wonderful for them because they can start rebuilding the brand new Fifth Avenue as they increase their sales.
LU: By staying in Trump Tower, Gucci will retain a prime flagship location for a reduced cost. Stefanie Tacata, is CEO of the fashion design & consulting group, Stateless. She says the most important part of this deal are the bragging rights that come with a slice of Fifth Avenue real estate.
STEFANIE TACATA: Most major retailers, or the major retailers that you see on Fifth Avenue are there so that they have a flagship presence on Fifth Avenue, those stores are so expensive, the rent tends to be so impressive that those stores lose money, really, if you look at the stores lose money on actually having those stores there, but in in the name of brand equity, and in having a presence not only for New Yorkers, but for World tourists, those flagship stores are important to them, they kind of bring legitimacy to the brand.
LU: Gucci’s retention of a Fifth Avenue footprint may be good for its public profile, but it’s hardly risk free. Kailee Scales is founder of ThinkFree Global Strategies. She says that by continuing its association with Trump, Gucci risks alienating customers and distancing itself from the fashion world at large.
KAILEE SCALES: I think if this situation is an indication, and other brands will take will take pause in engaging with the Trump brand or any brands of who represents the or doesn't represent us moving forward as a society in our in our dressing, racial and equity. I think that we've seen from this example, that addressing racial inequality, and thinking about how to dismantle systems that oppress different various intersectional groups in our world is something that consumers that consumers want to see more action and more activity towards dismantling those barriers.
LU: While other brands are taking strong social stances, Gucci’s decision reads as politically passive. For now, the Gucci Fifth Avenue flagship will remain in Trump Tower.
Fei Lu, Columbia Radio News.
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