Forever 21 Stores To Host First Brick-And-Mortar Outposts Of Chinese Giant Shein After Simon Deal
China-based Gen Z fast-fashion giant Shein has signed a deal with Authentic Brands Group and North America’s largest retail real estate group in a move that brings the prospect of Shein stores in the U.S. closer to reality.
In an agreement with Sparc Group Holdings, Shein has confirmed that it has entered into a strategic partnership under which Shein will acquire an approximately one-third interest in Sparc Group — the joint venture between mall giant Simon Property Group and brand management specialist ABG.
In addition, Sparc Group will become a minority shareholder in Shein.
ABG typically invests in distressed retailers, while Sparc Group provides the operational platform and Simon the store space through its national mall portfolio.
In contrast, while Shein has seen soaring sales, beyond pop-up stores and a single permanent store in Tokyo that opened in November 2022, it does not have any physical outlets.
Under the terms of the deal, the companies said that Shein will bring its e-commerce fast-fashion expertise and global reach to provide Sparc Group with a platform to help grow its brands.
Meanwhile, Sparc Group’s fast-fashion subsidiary Forever 21 will provide an opportunity to test Shein through the retailer’s locations across the U.S. including shop-in-shops, plus in-store returns and other initiatives.
Simon Property owns around 12% of ABG, Simon said at an earnings call in February 2023, with the joint venture including brands such as Nautica, Brooks Brothers, Reebok, Forever 21 and Eddie Bauer, which it part-traded with ABG for a larger stake in the parent business.
In October 2022, ABG purchased UK fashion retailer Ted Baker in a deal valuing the troubled brand at a highly discounted $253M.
ABG also owns a majority stake in Inter Miami owner David Beckham’s DB Ventures, which controls the rights to the former England football player.
“Together, Shein and Sparc Group plan to utilise their complementary platforms and expertise to accelerate product innovation, explore new business strategies, enhance customer experiences, and grow their presence in the marketplace,” the companies said in a statement.