Continuing to shed real estate assets to raise cash and reduce its debt, Kering announced a joint venture agreement with private equity firm Ardian for its property at 715-717 Fifth Avenue in New York City.

Kering said Ardian will hold a 60 percent stake, with it retaining the balance. The transaction was valued at $900 million, with Kering netting $690 million.

The address comprises multi-level luxury retail spaces totaling approximately 115,000 square feet, Kering said.

Last January, Kering transferred three prestigious Paris properties to a joint venture with Ardian in a deal valued at 837 million euros. Ardian similarly took a 60 percent stake in that new entity, with Kering holding 40 percent.

“As we continue to execute our strategy regarding the management of our real estate portfolio, we are pursuing our successful partnership with leading investment firm Ardian,” Jean-Marc Duplaix, Kering’s chief operating officer, said in a statement Tuesday. “Like the investment agreement already signed in Paris, this transaction allows us to secure another long-term highly prominent retail location for our houses while enhancing our financial flexibility.”

According to analyst estimates, Kering’s net debt ballooned from 200 million euros in 2021 to about 10.5 billion euros at the end of 2024 as the French group embarked on a major M&A and capex spree, buying Creed, Maui Jim and prime chunks of real estate. The Fifth Avenue property was purchased in early 2024.

Since he officially took up his duties on Sept. 15, Kering’s new chief executive officer Luca de Meo has made several big moves to reduce the group’s net debt, which stood at 9.5 billion euros at the end of June. 

In September, Mayhoola’s put options on Kering exercisable in 2026 and 2027 for its remaining 70 percent stake in Valentino were postponed to 2028 and 2029, respectively. Kering’s call option to acquire Mayhoola’s stake in 2028 is also deferred to 2029.

After the ailing French luxury group reported a 10 percent drop in third-quarter revenues last October, de Meo pledged to double down on efforts to cut costs and curb debt, with plans to ramp up store closures, refinance real estate and dispose of noncore assets.

In October, Kering said it would sell its beauty division to L’Oréal for 4 billion euros in cash, in addition to granting the French beauty giant long-term fragrance and beauty licenses for some of its top brands. The partnership, hailed as a category game-changer, also includes a joint venture in the field of wellness.

Tuesday’s deal marks Ardian’s first real estate investment in the United States.