LOS ANGELES — Hermès is expanding on the western frontier.

The Parisian purveyor of luxury items is further saturating the U.S. market by opening an expanded store Wednesday in San Francisco and a new unit in Honolulu. With only 15 stores in the U.S., the two stores represent a sizeable percentage increase in retail square footage on the domestic front. There are 200 Hermès stores worldwide.

Hermès has operated a store in San Francisco for 13 years. The new store, in the former Saks Fifth Avenue space at 125 Grant Avenue near Union Square, is, at 4,400 square feet, double the size of the original address at 212 Stockton Street on Union Square. According to Hermès USA chief executive officer and president, Robert B. Chavez, it represents “a significant investment” for the company.

The shop’s most dramatic features are high ceilings and a facade of charcoal gray metal and glass. And, there is a larger dedicated salon-like area to women’s ready-to-wear as well as a full range of Hermès’ 14 categories, including leather, watches, jewelry and handbags.

“Our business has grown significantly in San Francisco over the last several years and we were ready to do something special,” said Chavez, pointing out that the local client base stepped in to “shop with us more frequently” during the last few years, as tourist business slowed. “They were anxiously awaiting this new home that will most definitely become one of our top units in the country.”

Based on analysts’ projections of sales between $800 and $1,000 a square foot, Hermès is expected to pull in between $3.5 million and $4.4 million in sales during its first year. Although publicly traded in Paris, Chavez did not confirm the figures, citing Hermès’ private status in the U.S.

Meanwhile, in the South Pacific, Hermès opened its third boutique in Hawaii within the Ala Moana Shopping Center at 1450 Ala Moana Boulevard in Honolulu. Hermès has two sites in Waikiki and an in-store shop in Honolulu’s DFS Galleria.

Chavez said since its June 2 opening, sales at the 4,450-square-foot store have been brisk. The store is expected to pull in between $3.6 million and $4.5 million in its first year, based on analysts’ projections.Although San Francisco and Hawaii are among the tourist areas hit hardest by economic and geopolitical turmoil, Chavez claims Hermès has not felt the pinch. “I think the luxury customer is maybe the last to be affected in an economic downturn,” he said.

At least for San Francisco’s part, it appears the worst is over. “I believe we’ve bottomed out,” noted Linda Mjellem, executive director of the Union Square Association. “I’m getting feedback from various retailers that there’s an appreciable increase in visitor foot traffic.”

For 2002, Hermès reported a 1.3 percent rise in sales to $1.32 billion from $1.31 billion as a result of the weak dollar and yen. Excluding currency fluctuations, sales for the year moved ahead 5.9 percent.

Overall, Chavez said Hermès is poised to further “make a major investment in the U.S. market. We feel that it will provide a significant amount of growth for Hermès in the future.”

Although there are no plans to open more stores in the western region, Chavez said he envisions another store or two here within the next three to five years alongside existing stores in San Francisco, Beverly Hills and Costa Mesa, Calif.

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