You can’t choose your neighbors, and for luxury retailer Tiffany’s flagship location in New York, the next-door presence of Donald Trump severely dampened a key shopping season.
The blue-box jeweler on Tuesday reported a 14 percent decline in holiday sales at its Fifth Avenue store, citing “post-election traffic disruption.”
The midtown property is a critical part of Tiffany’s operations, accounting for over 10 percent of total company sales, according to a report by investment bank Jefferies Group.
The jewelry specialist also said total U.S. sales were $483 million over the holiday period, down 4 percent from the year-earlier period.
Trump Tower, where the president-elect lives and works, became a nexus of activity with the real estate mogul’s Election Day upset, bringing a near-permanent media presence, security perimeter and dedicated New York Police Department patrols. The Tiffany flagship, itself a tourist icon, shares its southern wall with Trump Tower.
Tiffany spokesman Mark Aaron declined to comment to CNBC about sales and foot traffic at the flagship store. “We’re trying to focus on things within our control,” he said.
In 2016, investment bank Jefferies Group said in a report that foreign tourists account for 40 percent of the store’s sales. Tiffany’s U.S. operations have suffered amid a strengthening dollar and weak demand from tourists and domestic customers, market research company Euromonitor International said in a 2016 report.
However, Jefferies’ Randal J. Konik on Tuesday maintained his buy rating on the jeweler’s stock price. The equity analyst said that while the decline is disappointing, it was “nowhere near” as dire as other analysts assumed. Konik said he expects “a gradual improvement as time goes by.”
The investment bank had said in a November report that “fears of a Fifth Avenue store slowdown are misguided,” and that concerns over street protests would be transitory.
The word on Fifth Avenue echoes this optimism.
“All the publicity about the marches and about the demonstrations brought more people into the shops,” said Faith Hope Consolo of Douglas Elliman Real Estate. She said people who didn’t know where Tiffany’s flagship was located would certainly know where it is now because it’s next-door neighbor is impossible to ignore. “They could thank Trump for the free publicity, believe me.”