Spanish ready-to-wear clothing brand Zara currently has four stores in the grand duchy but will focus its retail strategy in Luxembourg to its three shopping mall outlets--in Auchan Kirchberg, the Belle Étoile and the Cloche d'Or--as of 30 June 2021. 

Zara is part of the Inditex fashion retail group, which also has Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho and Zara Home in its stable of brands that are represented in Luxembourg. Most of them have retail units in the Cloche d'Or shopping centre, although Massimo Dutti also has a shop on the Grand Rue, but Pull & Bear exited the city centre in October.

Zara’s Grand Rue store currently employs 33 staff, all of whom will be relocated to other stores. David Angel, central secretary of the OGBL says his trade union will be “involved in the entire replacement process.”

The decision will be a blow to the Grand Rue’s retail customer pulling power, reckons Imad Abbaci, development director of retail consultants GeoConsulting. “Zara attracts a lot of people, because it has a premium reputation, well-honed marketing and diverse range of products…and strong variety all year round.”

Virginie Chambon, head of retail at Cushman & Wakefield shares similar sentiments. “Zara ensured a sufficient footfall at the end of the Grand Rue, it is a destination brand.”

As for the rent, which is at the core of the Spanish brand’s decision to quit the Grand Rue, Chambon says that some rents in the city centre have been reduced, but not systematically.

“Some rents were renegotiated after the first lockdown, allowing tenants a reprieve for three to six months so that businesses could recover. “These are not real rent cuts, but post-Covid support solutions,” says Chambon.

This article was originally published in French by Paperjam and has been translated and edited by Delano.