Chanel gets an expensive upgrade on Rodeo Drive

Los Angeles - The French fashion house was due for an upgrade. Known for its elegant decor and luxury merchandise, Chanel recently just bought out its current space to plan for a new Beverly Hills flagship. This all started with the French brand’s hopes of transitioning its current space into a three-story flagship.

Over two years ago, as reported by WWD, Chanel paid 100 million dollars for the space from Lladro USA Inc. The space that Chanel bought encompassed 16,129 square feet at 408 North Rodeo Drive. This was a strategic plan by Chanel to allow the company to possibly create a bigger, more expansive store. “That opened the door for Chanel to make a record offer so they could control their own destiny,” Robert Cohen, vice chairman of real estate brokerage and advisory firm RKF in Santa Monica, told WWD.

The Rodeo Drive slot is no low-profile location. The strip spans over three blocks and is known for its modish boutiques and shopping opportunities. The retail haven has garnered attention of many locals, tourists, celebrities, and more. Neighboring retailers include Tory Burch, Roberto Cavalli, Cartier, and more. In order to secure its expanded flagship, Chanel recently disclosed its payment of 152 million dollars for the next door space. In total, the space is 11,500 square feet.

Chanel finally expands Rodeo Drive flagship

The fashion house had to jump on the opportunity fast, as space on the street does not open up frequently. “Rodeo Drive is only three blocks and there’s no room for it to grow,” Cohen told WWD. Because of its reputation as a high-profile shoppers’ plaza, the street has a fairly high demand.

Chanel fits in perfectly with its high-end fashion including haute couture, ready-to-wear clothes, luxury goods, and accessories. The company’s estimated revenue for 2014 was 6.7 billion euros, which establishes the fashion house’s rankings for sales. Adding a boutique is a great strategy because it shows that the company is investing in their existing markets. In a world full of e-commerce and online shopping, it’s impressive when there is this much financial stake into a flagship.

Chanel’s newest flagship will be one of their biggest in space. It adds to the Beverly Hills culture of luxury fashion and appeals to the market of its surrounding locals. “The fact that Chanel is investing this much on a street, on a single space, is a positive story,” Cohen told WWD.

Photo: Chanel