King’s Tailor Cuts More Cloth as Spain Bankers Turn BullishMacarena Munoz and Charles Penty
Luis Sans, who tailors suits for former King Juan Carlos and jackets for Banco Santander SA Chairman Emilio Botin, is buying more cashmere as Spain’s recovery rekindles bankers’ desire for fine threads.
“People’s expectations have changed,” said Sans, 48, whose tailoring and luxury apparel store Santa Eulalia -- not far from Antoni Gaudi’s Barcelona landmark Casa Batllo -- was founded in 1843 and has been in his family for four generations. “They think this year is going to be better than last year and this favors spending by people who have money.”
As Spain emerges from a six-year economic slump and a 41 billion-euro ($56 billion) European banking bailout, financiers and businessmen are feeling more comfortable spending money on luxury goods and services. Mounting orders for hand-made suits and tuxedos signal confidence among the wealthy that Spain’s economic recovery is taking hold, Gonzalo Lopez Larrainzar, a high-end tailor in Madrid, said in an interview.
“We have been through the worst crisis I have known while working here for the last 32 years but now it does seem it has touched bottom,” Lopez Larrainzar said in an interview in his studio in central Madrid adorned with signed photos of clients including Juan Carlos and Simeon II of Bulgaria. “Our clients may have lots of money but if they aren’t confident about their business or the economy in general, they won’t buy.”
Lopez Larrainzar said he expects sales to increase this year for the first time since 2010 as clients, including top Spanish bankers as well as nobles and European royal family members, buy suits with a starting price of 2,000 euros. Sales more than halved to about 130 suits last year from about 300 before the crisis began about six years ago.
A real-estate crash starting in 2008 sparked a banking crisis that spiralled into a slump in Spain, draining more than 400 billion euros of credit from the economy and leaving a quarter of Spaniards without jobs. The economy started to expand again in the third quarter of last year and the recovery is now gathering momentum, leading the government to predict growth of 1.2 percent this year and 1.8 percent in 2015.
Retail sales, which had fallen for 38 months through August last year, rose at an annualized clip of 0.8 percent in May, according to Spain’s National Statistics Institute. An April survey on lending conditions published by the Bank of Spain showed banks relaxed their criteria for approving consumer loans for the first time since the start of 2010.
Spanish banking shares have risen as investors bet the worst of their real estate-linked losses are behind them. Santander is up 14 percent this year and 85 percent since its crisis low-point in 2009.
For Santa Eulalia, on Barcelona’s exclusive Passeig de Gracia, its history remains a lure -- the shop has chairs used in its first fashion show in 1926 and the men’s fitting room has three mirrors that date from 1940. Customers willing to shell out 2,800 euros or more for suits are returning, Sans said. He expects his 15-member team to stitch 380 bespoke suits this year and 400 next year compared with 368 in 2013.
At those prices, customers can be picky. Take Santander’s Botin, for example. Botin, 79, favors suits in marine blue or charcoal tones and has ordered sports jackets and trousers in the bank’s red livery. Botin once sent a color sample in advance so that Santa Eulalia could get the tone just right, said Sans.
“Wearing a tailor-made suit is like an addiction -- you never want to go back,” said Sans, who sports dark-rimmed glasses and wears cotton, linen or wool suits from his store.
Anticipating an eventual return of customers, Sans invested in the business throughout the crisis, hiring New York architect William Sofield to do a 2011 redesign of his store housed in a building owned by Amancio Ortega, who became Spain’s richest man after founding mass-market clothing retailer Inditex SA.
Raimundo Martin, 45, the Madrid-based head of Mirabaud Asset Management for Spain and South America, is the kind of Spanish banker tailors like Sans target. Martin buys his suits at Boggi, an Italian brand, and Jaime Gallo, a Madrid suit-maker whose clients have included Spain’s new King Felipe VI and bullfighter Francisco Rivera Ordonez.
“I always have my suits tailor-made -- the difference would be in the number that I get,” said Martin. “It all depends on your mood and expectations.”
Still, not all luxury clothes makers expect surging demand.
There’s little sign that customers at Madrid shirtmaker Camiseria Burgos are more willing to put down 200 euros for bespoke shirts or 300 euros for Cuban-style “guayabera” linen tunics, said co-owner Carmen Alvarez in an interview.
“We have very wealthy customers but that doesn’t necessarily mean that they feel like going shopping,” said Alvarez, whose family has run the store for 102 years and counted movie star Cary Grant and Orson Welles among clients.
Her shop has sewn shirts for King Felipe since his First Communion in 1975, embroidering them with his initials F.B. for Felipe de Borbon, the name of Spain’s royal house.
Spain’s family-owned firms of luxury apparel makers are no strangers to turbulent economic times, said Lopez Larrainzar. Santa Eulalia was collectivized at the outbreak of the Spanish Civil War in 1936 as Barcelona’s government of the day questioned “the sense of an haute couture company in the new republican society,” according to the store’s website.
Even so, their long-standing connections to the Spanish elite have helped them survive to the present day even as some traditionally wealthy clients have fallen on hard times, said Lopez Larrainzar, whose family has run the tailor’s shop for three generations since it was founded in 1918.
“The marquesses and counts used to have plenty of money but now some of them don’t have a penny,” he said. “The money has changed hands and the rich people now aren’t necessarily the same as they used to be.”
While bankers keep buying his trademark blue and grey business suits, artisan tailors in Madrid and Barcelona face longer-term challenges, said Lopez Larrainzar. More dangerous to firms like his than any economic slump are the changing vagaries of fashion and the trend for wealthy Spaniards to dress more informally, he said.
“A classic Spanish gentleman’s suit is very stylish -- somewhere between the elegance of Savile Row and the more daring style of Milan,” he said. “My grandfather was making 4,000 a year in the 1950s and 1960s.”