LVMH Group Plans New Breakthroughs In Its Own Channels

According to recent news, LVMH group, one of the shareholders of the Shanghai luxury shopping center, will sell 50% of its holdings.

At present, the fund is in touch with several companies, including another shareholder of the SHANG Jia center, Australia entertainment App China Group Ltd.

In response to this, LVMH group's LV brand said it did not understand the matter, while the group did not accept media coverage.

Reporters repeatedly called SHANG Jia Center

No one answered.

Then sent an email to the relevant department of the SHANG Jia center, but as of press time, the other side did not respond to the matter.

The Beijing Commercial Daily reporter contacted the former director of the SHANG Jia center, but the other side also said it was not easy to express their views.

Statistics show that in 2007, LVMH group's L Real Estate real estate company and Australia entertainment App China Group Ltd took the Chia Jiaxing block, which was sold at the time of 1 billion 432 million yuan, with a total construction area of 140 thousand square meters, with a total construction height of 134 meters, 28 floors above ground level and 4 underground levels, with a total investment of 500 million US dollars.

Since its opening in June 2013, the SHANG Jia center has been operating for only a year and a half.

According to insiders, once the sale of LVMH group's shares is successful, its brand settled in SHANG Jia center will be withdrawn in March this year.

According to incomplete statistics, there are nearly 20 brand stores in LVMH group in SHANG Jia center.

As one of the major shareholders, LVMH group has used its own brand advantage to start up many brands of Prada group, Kai Yun group and Li Feng Group during the opening of SHANG Jia center.

A luxury store operator in Beijing said that once the brand of LVMH group really withdrew from the SHANG Jia center, it would definitely affect the cooperation between shopping malls and other brands.

"A large area of brand withdrawal will have a direct impact on the reputation and passenger flow of shopping malls. When the shop lease is not expired, other brands will negotiate with the shopping malls on the basis of the loss during the adjustment period, usually asking for rent free or rent reduction requirements, or requiring corresponding compensation, depending on the communication between brands and shopping malls."

The person in charge said.

According to the opinions of insiders in the win business network, LVMH group sells the shares of SHANG Jia center and the time of cash of the group's funds at this time. The general fund's cash cashing time is 5-8 years, and the SHANG Jia center has just eight years since it took it.

One thing that can not be overlooked is that Shanghai's Changning District Xian Xia Road, as a new business district in the last two years, is not mature enough to enjoy luxury shopping.

Beijing Business Daily reporter survey found that the main core business district of Shanghai is concentrated in Huaihailu Road, Nanjing West Road, Nanjing East Road, people's Square, Lujiazui and Jingan.

The six major business circles are mainly concentrated in downtown Shanghai and Pudong New Area, where the old luxury shopping mall, Hang Lung Plaza, Hong Kong Hui square and state gold IFC are all concentrated here.

However, the Zhongshan Park business circle near the SHANG Jia center is located in the west of Shanghai. Compared with several business circles that developed early and the commercial atmosphere is mature, the luxury consumption atmosphere of Zhongshan Park business circle has not formed.

The maturity of the commercial sector is evident from the rents of luxury shopping malls.

According to industry sources, the first batch of shops in the SHANG Jia Center signed a rental of 30 yuan per square meter / day, while the first floor of Hang Lung Plaza in Nanjing West Road was quoted in the three quarter last year for 114 yuan / square meter / day.

Counting the main shopping centers in the Zhongshan Park business district, dragon dream and Paris spring are mainly selling high-end high-end fashion brands, while in Zhongshan Park radiation zone, 2.8 kilometers away from the Dragon dream, the shopping center at the top of the luxury shopping center is just like a mere bird.

Similarly, the Japanese luxury department store high island house near Zhongshan Park business district has been doing dim since the end of 2012.

With the huge investment in the luxury consumption atmosphere which is too late to be heated up, perhaps the world's largest luxury group has begun to waver.

The mainland downturn is turning the bow?

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In 2007, luxury goods were at the golden stage in China.

The performance of several major luxury goods groups has been booming, maintaining a double-digit growth rate.

LVMH group takes 50% stake in the SHANG Jia center, which is based on an optimistic attitude towards the prospect of the luxury market in the mainland.

Now the market dividend is over, and the market environment is no longer what it used to be.

As of the three quarter of 2014, LVMH group's total revenue grew by only 4% over the same period last year.

In the face of the nearly saturated domestic luxury market, in July 2014, LVMH group closed 1 of Louis Weedon's 4 stores in Shenyang, Liaoning Province, and in December, the Shangri-La Hotel Louis Weedon store in Hohhot was also closed.

At the same time, the LVMH group has made new strategic adjustments.

In December 2014 alone, LVMH group's private equity fund L Capital Asia LLC revealed that it would be the largest swimsuit manufacturer in Australia.

According to foreign media reports, partners of L Capital Asia LLC went to Sydney on the same month, and will also attend the opening ceremony of Sephora group's first store in Sephora, a beauty product retailer of LVMH group.

Analysts say that compared with the Australian blue ocean market that has not yet opened a SIFE shop, LVMH group needs new ideas to break through in the saturated luxury market in the mainland of China.

At the same time, the huge global luxury empire is not bound by China's mainland market, and its acquisition and investment are all over the world.

But the SHANG Jia center, which has been smashed money, has yet to be cultivated.