By  on November 28, 2005

With brand-savvy tourists returning in droves and hungry for luxury merchandise, there's optimism and renewed confidence in the state's economy.

NEW YORK — Brand-conscious Japanese tourists are flocking back to Hawaii after staying away for several years after 9/11 and the SARS outbreak, and they're buying with a vengeance.

The signs of optimism are everywhere. In Waikiki, the Outrigger Beach Walk project, Royal Hawaiian Shopping Center and Ward Village Shops renovations as well as the International Market Place redesign are evidence of a retail explosion and renewed confidence in the economy.

Visitors to Hawaii spent $10.9 billion in 2004, 8 percent more than in 2003. Of that total, Japanese visitors spent $2.2 billion, a 13.7 percent rise above 2003, giving the demographic group a 20 percent share of spending, according to a report by the Department of Business, Economic Development and Tourism of the State of Hawaii.

On a daily basis, Japanese tourists increased their purchasing from $240 a day to $252. They devoted $99 a day to shopping, a 10 percent increase over 2003 and three times as much as visitors from the U.S., Canada and Europe, the study said.

To keep up with the demand, luxury retailers are opening second and even third stores on the island. And if they're not building new stores, they're expanding existing ones.

"Hawaii is one of the most important luxury shopping destinations in the world, and it's only natural that Bottega Veneta have a strong presence there," said Tomas Maier, creative director of Bottega Veneta, earlier this month. "We're thrilled to open our third Hawaii location at 2100 Kalakaua Avenue."

Other boutiques at the three-story town house-style center include Coach, Tiffany & Co., Yves Saint Laurent, Tod's and Boucheron.

Lehman Bros. sold 2100 Kalakaua Avenue for $156 million to Metropole Realty Advisors and Heller Properties. Robert Siegel, president of Metropole, said 2100 Kalakaua Avenue generates $1,700 to $1,800 in sales per square foot, but could do four times that amount based on pre-9/11 sales volume at luxury stores in the area. Higher sales are anticipated because there's about 20,000 square feet of vacant space, providing room for another two luxury stores. Moreover, the property will be marketed more intensively, particularly to international tourists.

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