FL MORRIS / FMORRIS@STARBULLETIN.COM Chanel will be among the high-end retailers in the new Honu Group development at 2100 Kalakaua Ave.

Honu Group readies
more luxury retail
for Waikiki

The developers of 2100 Kalakaua
will use cultural attractions
to woo Japanese shoppers

---

By Russ Lynch
rlynch@starbulletin.com

People who say the big-spending Japanese tourist market in Hawaii is never going to get back to where it was in the 1990s are looking in a rear-view mirror, say the developers of 2100 Kalakaua.

Furthermore, they are out of touch with real Japanese attitudes, said developers Honu Group Inc.

The 2.5-acre low-rise development at the entrance to Waikiki, due to open next month and have a grand opening in early December, contains a mix of international brand-name retailers. Among them are style leaders Tiffany & Co., Yves Saint Laurent, Chanel, Gucci, Tod's and Boucheron. The last three have not previously had a Hawaii store.

After land purchase and construction, the development will cost about $140 million and will be worth more than $200 million by the time tenants complete their improvements in the next month, according to the group.

That's a lot of money invested in a project that some observers suggest flouts the reality of Hawaii's post-Sept. 11 tourism market.

But those observers are wrong, said Thomas Applegate, president; and Mona Abadir, chief operating officer, of Honu Group. Their group, headed by Chief Executive Officer Andrew Smith, has many years of retail experience, they said.

Big-name tenants like those they have signed up don't select a location lightly. They are all global companies with an international outlook and a long-term attitude about their investments, Applegate said.

Applegate, Abadir and other Honu executives have spent a lot of time in Japan this year. In late September, they pitched the project to more than 120 Japanese media outlets and they listened to what the Japanese had to tell them. What they heard told them they were on the right track.

The Japanese all know about Hawaii and it is the destination of their dreams, countless surveys show. Right now their Hawaii numbers have slipped, with their own economy in the doldrums and the lingering effects of 9/11, plus competition from cheaper destinations closer to home, such as Korea and China.

The key to getting them back to Hawaii is giving them more of what they want, more contact with local culture and the arts, said the Honu Group executives.

The 2100 Kalakaua project has brought its retailers together with local culture and arts organizations, including the Contemporary Museum, Diamond Head Theatre, Hawaii Opera Theatre, Hawaii State Art Museum, Hawaii Theatre Center, Honolulu Academy of Arts, Honolulu Symphony and Iolani Palace. Hawaii Public Television and Hawaii Public Radio are also taking part.

What that means is visitors to the center will be offered a steady stream of performances and displays, with each of the retailers pushing -- and financially supporting -- its own selected art and culture organizations.

"What we found out from our first trip was the Japanese are really craving more information about Hawaii culture and the arts," Abadir said.

The idea of retailers contributing to local nonprofits has proven successful at Honu Group's King Kalakaua Plaza across the street.

Nike Town has raised $130,000 to help local charities since it came to the King Kalakaua plaza three years ago, Applegate said.

Honu Group's latest trip to Japan involved passing a message to the Japanese that they can shop, enjoy and learn at the same time, Applegate said.

Connecting Japanese travelers with local activities is behind the choice of Dec. 6 for the grand opening of 2100 Kalakaua, Applegate said. That is the weekend of the Honolulu Marathon, which attracts thousands of Japanese runners and families, many of whom will stop by Nike Town.

There will be entertainment in the whole area and tickets will be sold, with all the proceeds going to arts partners.

Honu Group believes the Japanese market still will be good for Hawaii and good for the businesses that have the patience to see out the current slump, said Applegate. And a of the tenants at 2100 Kalakaua believe that.

Tiffany executives have said they have no worries about investing in the new center because the company already has a decade of experience in Hawaii and knows what to expect.

The retailers in the new center are "treating Honolulu as a global city, rather than a national city" and a close connection with culture and the arts is part of that attitude, Abadir said.

Applegate and Abadir both said there is no way they are ignoring the local market while they push their international objectives. There is a very strong resident market for upscale fashions and accessories, Applegate said. These are people who may have been going to other cities, outside Hawaii, to buy their favorite items and increasingly, with developments such as 2100 Kalakaua, can do it at home, he said.

Next will come Phase II of 2100 Kalakaua, on the Kuhio side of the property. That will include small businesses, eating and entertainment places.