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Ala Moana reshaped retailing in Hawaii


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POSTED: Sunday, August 16, 2009

When Ala Moana Center first opened on Aug. 13, 1959, it offered 80 stores on two levels and was dubbed the largest shopping center in the United States.

It offered more than 680,000 square feet of retail space, anchored by Sears and Shirokiya, along with a couple of stores that are now history, including F.W. Woolworth and McInerny.

Today, Hawaii's largest mall has more than 290 stores and restaurants, including high-end luxury boutiques, in about 2.1 million square feet of retail space that includes the new Nordstrom wing.

It ranks as one of the world's largest outdoor shopping centers and is among the top three highest-grossing malls in the United States.

Honolulu market analyst Marty Plotnick, 71, considers Ala Moana Center's opening a landmark accomplishment for the state, a move that brought in mainland investors and put Hawaii on the map.

“;Ala Moana made a tremendous impact on Hawaii by its sheer size and the number of employees it had per square foot,”; said Plotnick. “;And it was local.”;

Many people thought it was crazy to put a shopping center at the 50-acre site of a former swamp at the time, with some even suggesting that it be named after the developer as “;Dillingham's Folly.”;

But Plotnick said it was a smart move.

Developer Donald Graham, 95, who was then with Dillingham Corp., recounts how he had to persuade a mainland lender to grant a loan for the center in Honolulu. He also remembers how he made a deal with Sears to anchor the mall by offering $1.5 million to buy its existing building in Pawaa.

Sears is one of 11 original tenants that have been at the mall since it opened in 1959, along with Longs Drugs, Foodland, Shirokiya, Reyn's, Slipper House, Watumull's, Dairy Queen, Territorial Savings Bank, the U.S. Post Office and the Crack Seed Center.

Besides witnessing several changes of ownership, along with six phases of expansion, they have survived the ups and downs in the economy.

When Foodland opened at Ala Moana, it was the largest in the chain, according to an Aug. 12, 1959, Star-Bulletin article. The store was then running ads selling a dozen doughnuts for 29 cents and a pound of Maunakea coffee for 67 cents.

Today a newly renovated Foodland remains the only supermarket at the center.

Ted Li, owner of the Crack Seed Center on the ground floor, says customer service has been the key to the store's longevity.

Li, a former computer programmer who runs the store with his wife, Patricia, took over the business about 20 years ago from the original owner, Nora Kam.

He says quality of service is even more important during economic slumps. Since snacks are an affordable item, customers still walk in, looking to buy a quarter-pound or half-pound.

Crack seed is just as popular today as it was 50 years ago.

The store offers more than 80 different items in glass jars — from pickled mangoes to several kinds of li hing mui, ginger, candies and fish jerky. Li keeps his prices competitive.

Li, 63, says he has a set of loyal customers who have been coming since the store opened, including those who grow up and bring their own children to the store.

Reyn's, the aloha shirt boutique founded by Reyn McCullough, is in the same spot it was 50 years ago on the mall level.

The original concept was for a Brooks Bros. type of store. McCullough wanted to design a shirt that was casual yet professional. Today the signature Reyn's aloha shirt — with the reverse-print, button-down collar — remains pretty much the same.

The merchants say they have managed to survive by adapting to the times, but also by staying true to themselves.

In 1959, Shirokiya at Ala Moana was the chain's first store to open outside of Japan, according to marketing director Anna May. “;Local shoppers really keep us going,”; she said.

Shirokiya has a set of loyal customers who were concerned, particularly when its Japanese-based parent announced plans in 2001 to close the store. It was eventually sold to a local management company. Two of Shirokiya's employees have been with the store since day one.

Many shoppers still go there looking for unique items and crafts to celebrate Japanese traditions. On the other hand, the store recently downsized its electronics department due to competition.

Shirokiya will soon embark on renovations to expand its food section, which makes up more than 60 percent of sales.

Three generations now run Watumull's, a Hawaii-wear and accessories boutique that has been at the mall since it opened.

J.D. Watumull says his father signed a lease for the boutique with Graham and opened a few weeks after Sears. His key advice for adapting to changes is to “;listen to your customers.”;

Plotnick said even with the current debt issues faced by owner General Growth Properties and another potential change of ownership, Ala Moana Center is not going anywhere.

 

In the beginning

Ala Moana Center's tenants since 1959:

» Sears » Shirokiya

» Foodland

» Watumull's

» Reyn's

» Slipper House

» Crack Seed Center

» Long Drugs

» Dairy Queen

» Territorial Savings Bank

» U.S. Post Office

 

Special offers from the original merchants

Ala Moana Center's landmarks

» 1912: Walter Dillingham buys the 50-acre site of Ala Moana Center for $25,000 from Princess Bernice Pauahi Bishop.

» 1959: Ala Moana Center phase one is completed with 680,000 square feet, 80 stores on two levels, including Sears and Shirokiya.

» 1966: Phase two opens, doubling in size to 1.35 million square feet, 155 stores, including J.C. Penney and Liberty House.

» 1982: D/E Hawaii Joint Venture (Daiei and Equitable Life Assurance) buys Ala Moana for $300 million.

» 1987: Phase three is completed with a new food court.

» 1990: Phase four is completed with luxury stores Chanel, Gucci, Cartier to cater to the boom in Japanese visitors.

» 1998: Neiman Marcus opens.

» 1999: General Growth Properties buys Ala Moana Center for $810 million.

» 2005: Hookipa Terrace opens on a fourth level.

» 2008: Nordstrom opens, along with 30 more stores and a new parking garage.

» 2009: Ala Moana celebrates its 50th anniversary.