California Apparel News

There are two retail sectors outperforming every other category in retail: luxury and off-price.

Adam Freede, cofounder and president of the MadaLuxe Group, headquartered in Seal Beach, Calif., says he hopes to mix the two categories like no one else.

“We went after luxury for the off-price sector,” he said. There is no shortage of mono-brand boutiques selling off-price luxury goods at outlet malls. But there are no multi-brand boutiques selling luxe goods off-price, Freede said.

Recently, Freede and his company opened a multi-brand, off-price boutique called MadaLuxe Vault at the Citadel Outlets, a short drive from downtown Los Angeles. The 3,000-square-foot shop offers clothing from European heritage brands with price tags discounted by as much as 60 percent. It also offers accessories from European fashion brands as well as watches and eyewear at 20 percent off.

MadaLuxe is bullish on the concept and forecast it will open as many as five more MadaLuxe Vault locations in the upcoming year. One might be located at the Outlets at San Clemente in San Clemente, Calif., which is owned by the Craig Realty Group, the same group that owns the Citadel Outlets.

Steven L. Craig, president and chief executive officer of the Craig Realty Group, is a partner in MadaLuxe. He predicted MadaLuxe Vault might open at several other Craig Realty outlet centers around the country or perhaps other locations not owned by Craig Realty.

For 2017, MadaLuxe forecasted that its retail sales would be more than $200 million, according to a company statement.

Domestic shoppers and overseas tour groups, which make up a little more than half of the Citadel’s retail traffic, increasingly demand luxury brands, Craig said. While the Citadel is an address for outlet stores from high-end brands such as Coach and Michael Kors, MadaLuxe Vault will boost the outlet center’s luxe cachet with its wide variety of luxury labels. “This brings us eight to 10 high-end brands from Europe that we didn’t have before,” Craig said.

In 2010, MadaLuxe got in the business of selling excess inventory made by European fashion brands. It also imports and distributes full-price watches from European brands such as Ferragamo, Versace and Versus Versace. MadaLuxe also serves as an equity partner in Los Angeles brand Haute Hippie.

When MadaLuxe Vault opened, the company also introduced an e-commerce shop at www.madaluxevault.com, which doesn’t sell clothes. It is devoted to accessories, watches and eyewear, said Sandy Sholl, MadaLuxe’s cofounder, chairman and chief executive officer. “We’re very protective of brands,” she said. “They do not want to see product discounted online.”

They also make a point not to open physical store locations in shopping centers and retail streets where MadaLuxe partners run their locations.

This year, Citadel Outlets had $750 million in annual sales, Craig said. When his company took over the site in August 2003, the outlet center was making $39 million in sales. He credits the success to popular retailers doing business at the center as well as keeping the mall grounds as clean as possible.

“We use the Disney model,” Craig said of the customer-service plans inspired by The Walt Disney Company’s parks and resorts. “Everyone is treated as a guest. Every five minutes someone is cleaning something up. We are training people how to please.”

Similar to A-level malls such as Westfield Century City, trends in offering more dining choices and entertainment also are important at Craig Realty outlets. There is a big emphasis on offering more food choices and live music at the Outlets at San Clemente. “There’s a lot of attention to detail,” Craig said.