David and Simon Reuben have bolstered their New York City property investments with the purchase of a Madison Avenue location that houses two luxury fashion brands.
The British billionaire brothers acquired roughly 11,000 square feet (1,022 square meters) of retail space at 747 Madison Ave. through a joint venture with Jeff Sutton’s Wharton Properties, according to a statement from the Reubens’ namesake firm, which didn’t disclose financial terms. Versace and Alexander McQueen’s North American flagship stores are both located on the site.
The Reubens control one of the world’s biggest portfolios of retail, office and residential properties. Sons of Iraqi Jews, they were born in India and moved to London as teenagers. They built a fortune trading metals through their company Trans-World Group, which they sold in 2000 to Russian billionaire Oleg Deripaska and invested the proceeds in real estate, leisure and technology companies.
David, 84, and Simon, 82 this month, have a total net worth of about $14 billion, according to the Bloomberg Billionaires Index.
The brothers have disclosed seven real estate investments in New York since the start of 2020, including the purchase of the Surrey Hotel on Manhattan’s Upper East Side, financing for the Time Hotel near Times Square and the Apthorp, a luxury condo building on the Upper West Side.
They’ve bet on Madison Avenue before, acquiring three properties during 2021 in the shopping corridor, including the location of Georgio Armani’s flagship outlet. Elsewhere in the U.S., the brothers are exploring ways to finalize one of Los Angeles’s biggest real estate projects after recently taking control of major parts of the $2.5 billion plan through debt financing deals.
New York’s retail market has bounced back from pandemic lows faster than offices, although there’s still nearly 22 percent of retail space available to rent as of the first quarter, according to brokerage Jones Lang LaSalle Inc.
Luxury retail districts such as Upper Fifth Avenue, Madison Avenue and SoHo are having an easier time finding tenants, with those areas having the lowest amount of supply available to rent on record. Asking rents on Madison Avenue jumped 38 percent from last year to $860 per square foot on the ground floor, but are still down from before the pandemic, when rents exceeded $1,000 per square foot.
While there have been few commercial property transactions in recent months due to soaring borrowing costs, some family offices and high net-worth investors have been circling the Manhattan market looking for attractive deals.