H&M potentially opening a new COS location

H&M has closed its store at 505 Fifth Avenue, but, they are still holding on to their retail lease. The 505 Fifth Avenue store is located right across from one of their primary competitors, Zara, who just opened a new expanded 43,000-square-foot-flagship location right across the street. For anyone who thinks that H&M is waving a white flag to Zara, they would be sadly mistaken.

According to WWD, H&M is most likely holding on to the lease so they can make a home for their new more upscale brand, Collection of Style, more popularly known to those in NYC as COS. In 2014, COS opened it's first store in SoHo at the heart of the boutique district at 129 Spring Street. COS stores to tend to be a little more intimate compared to their sister brand H&M, but the 505 Fifth Avenue location is a whopping 24,000-square-feet.

H&M closes 505 Fifth Avenue location

COS has become famous for their clean and intimate styles and silhouettes, giving people that higher quality at a more accessible price point with items like dresses priced anywhere between 70 and 120 dollars. In addition to working on expanding COS, H&M also plans to expand their denim concept, Cheap Monkey. & Other Stories, whose SoHo location has been doing very well, is also expected to be expanding as well.

In regards to the store expansions and the recent closing of the 505 Fifth Avenue location, a spokeswoman for the company said, "The U.S. is one of the biggest expansion markets for H&M and it has been in operation for over 15 years. Store closings can be a natural occurrence as countries become more mature and [we] continue to open stores in close proximity to each other. Our goal is to concentrate on our business in the nearby stores to better serve our customers. There are currently 12 stores in Manhattan."

It is rather unusual for H&M to close stores, but, having recently opened a massive flagship location at Herald Square that is over 65,000-square-feet making it the largest H&M in the world, as well as already having a location in Times Square, and their second largest location in the world (57,000-square-feet) at 48th and Fifth, the 42nd and Fifth location seemed to close to other major locations. H&M, being the benevolent employer they are, has not laid off any of the employees at the recently closed location, and instead, has offered them the opportunity to move to other locations in equal or comparable positions.

The store closure should be taken as no sign of H&M slowing down or suffering. Their parent company Hennes & Mauritz reported a 20 percent increase in revenues for the second quarter ending May 31. H&M currently has no plans to close any other stores in NYC, so, it seems like they are just putting more energy into their other brands. Hennes & Mauritz still seems poised to have their monopoly on the Manhattan retail market.