Ala Moana Center Honolulu

Retail reinvention?  That’s what the executives at Ala Moana Center in Honolulu are constantly doing even while sitting in one of the top spots for shopping centers worldwide.

Dior is set to open a boutique this month with Valextra expected to open by the end of the year. A handful of other brands are on the list of incoming stores for 2019 when the center turns 60. They’ll join the recent opening of a Uniqlo flagship, which was preceded by the Japanese retailer’s 3,000-square-foot pop-up prior to the store’s first phase opening.

“It’s [Uniqlo] doing tremendous business and it’s been a huge activator,” said Kirsten Lee, Brookfield Property Partners LP senior vice president of leasing retail. “One of the strengths of Ala Moana is that we offer all levels of merchandising from high to approachable. We service our shopper, which is 50 percent tourist and 50 percent local.”

The center had been owned by GGP Inc., whose acquisition by Brookfield Property Partners LP was finalized in August.

Few centers on the West Coast can lay claim to the kind of broad appeal Ala Moana offers from luxury to basics. Fashion Show mall on the Las Vegas Strip is one, totaling about 2 million square feet and anchored by Neiman Marcus, Forever 21, Nordstrom, Saks Fifth Avenue, Macy’s, Dillard’s and Dicks Sporting Goods. There’s also South Coast Plaza in Orange County, which has both the mix of fast fashion in Forever 21 and H&M to luxury houses such as Louis Vuitton and Chanel.

Ala Moana, with its 2.4 million-square-foot footprint and more than $1.4 billion in annual sales, is what Lee called a city unto itself. It actually can say that with a satellite City Hall outpost located on the property, in addition to residential, offices, a gourmet grocer in Foodland Farms and retail ranging from Hermès to Target. The luxury condominium project, Park Lane, developed by Kobayashi Group and The MacNaughton Group in partnership with GGP is nearly complete in its sell through, according to Lee, with the highest-priced unit going for more than $20 million.

The property’s been consistently tweaked in recent years to remain competitive, with 2008 seeing the completion of a 300,000-square-foot expansion. The Ewa Wing expansion was finalized in late 2015 and brought the first Bloomingdale’s to Hawaii along with 34 new tenants. The following year, Nordstrom completed its relocation, freeing up its old space for Target to move into in 2017.

Because of its sheer size, Ala Moana doesn’t have to pick and choose between being a center focused only on contemporary brands or only first-to-market concepts. It can have everything.

“Ala Moana is the largest outdoor shopping center in the world so we have so much space at this property that we can focus our merchandising efforts in several different ways,” Lee said. “We’re always looking at best in breeds in each of the categories, whether it’s luxury, F&B [food and beverage], juniors, apparel or local services. It’s a city. It really is.”

The center is now in the midst of weighing its options on the next phase of development, which will include uses beyond retail to ramp the productivity of existing retail.

Lee said the majority of the property is fully leased with a handful of spaces mixed throughout dedicated to short-term leases that can be tested out in different merchandising zones.

This all works due to the center’s draw area. The majority of the tourist base is coming from Japan in addition to Australia, China and South Korea among other countries in addition to the Mainland visitor.

Despite the draw, the same need to offer more than just a place to transact is top of mind at Ala Moana in much the way it is for any property owner.

“We see the same trends being mirrored with Ala Moana that we do at other properties and that’s a desire for an experiential retail connection to the consumer in an authentic way,” Lee said. “Retailers that are doing the best are creating that type of connection to the consumer in a unique way, not just providing merchandise in a store.”

A good example of that is the center’s boost to its food offerings. The center redeveloped the former Shirokiya space and spun it into a food hall called the Lanai, filled with 12 specialty food vendors.

“Our original idea was that we would go for more of an artisanal food offering, but what we realized is that our consumer wanted grab-and-go items,” Lee said. “They wanted really well-prepared, delicious food that they could quickly eat. That’s an improved version of what Ala Moana’s offerings have always been but we needed to stay competitive.”

Next year, mall officials look to build buzz around the 60th anniversary in August. The center’s leasing pioneer Kay Day is also set to reveal a coffee table book documenting the history of Ala Moana. Day, who previously modeled before joining the leasing team, is credited with inking the center’s initial wave of luxury tenants. The book is slated for a spring release.

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