Bosporus Boom

Istanbul has become the latest luxury destination as a generation of free-spending, energetic entrepreneurs give the ancient city a modern edge. Brands like Fendi and Dolce & Gabbana are catching the buzz, eager to set up shop in the gateway to the East

ON WEEKENDS, THE LINE AT ISTANBUL'S Mangerie, a hip rooftop restaurant with views over the Bosporus Strait, stretches three stories down the stairs toward the street. On a recent Sunday, Defne Kocabiyikoglu, 28, a design consultant, and her boyfriend, Baran Baran, 30, a motion-graphics animator, were settling into a Turkish brunch of kasar cheese and sesame-sprinkled simit pastries and expounding on the fashion constraints of the city. While Kocabiyikoglu can get any clothes she wants—favoring fashion-forward labels like Roksanda Ilincic and Tina Kalivas, which she buys online and mixes with local finds, she points to her Chanel ballerina pumps and adds...

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