Tenants gobble up
Wal-Mart leasesThe Keeaumoku Street location
will feature a mix of local eateries
A mixed plate of food-service operators has signed leases for retail space at the Wal-Mart and Sam's Club double-decker shopping complex near Ala Moana, hoping to cash in on the large numbers of hungry and thirsty shoppers expected when the big-box stores open in the fall.
Wal-Mart spokeswoman Cynthia Lin said six of the tenants will occupy Wal-Mart's "Shops at Keeaumoku" space fronting Keeaumoku Street. They include Golden Coin Bake Shop and Restaurant, Japanese takeout restaurant Hanazen, Coldstone Creamery, Starbucks, Jamba Juice and Supercuts.
Moving in
These businesses have landed coveted retail space at the Wal-Mart superstore complex on Keeaumoku Street:>> L&L Hawaiian Barbecue
>> Golden Coin Bake Shop and Restaurant
>> Hanazen, a Japanese takeout restaurant
>> Coldstone Creamery
>> Starbucks
>> Jamba Juice
>> Supercuts
Plate lunch outlet L&L Hawaiian Barbecue has leased space inside the Wal-Mart store, near the entrance.
The space will be turned over to the tenants in July, said Jon-Eric Greene, of Colliers Monroe Friedlander, leasing agent for the space.
The Wal-Mart space has been considered prime territory, and Lin said more than 50 businesses applied for the leases. But although Wal-Mart had its pick of tenants, Lin said the company leaned toward local businesses.
"We made a deliberate decision to feature local businesses," she said. "This brings a good tenant mix and a lot of local flavor."
Aside from the locally owned Golden Coin and L&L Hawaiian Barbecue, Hawaii outlets of Starbucks and Jamba Juice are 95 percent owned by Coffee Partners Hawaii, a local group.
Hanazen is a new eatery developed by Hatsuhana Hawaii Inc., owners of Hatsuhana Restaurant in the Hilton Hawaiian Village. Coldstone Creamery is owned by a local franchisee.
Lin said the spaces range from 500 feet to 780 feet. The space was marketed at $8 per square foot, higher than the $2.50 to $3.50 per-square-foot prices prevailing along Keeaumoku Street, said Greene.
"You see that across the country with Wal-Mart projects. Rents are typically 30 to 50 percent higher," Greene said.
Yet those rents are not unreasonable, retail marketing analyst Stephany Sofos said.
"Those are higher than the immediate area, but you can't compare the two," she said. "The Wal-Mart space is more similar to the Ala Moana food court, which gets a lot of traffic. Those rents are higher because there will be so many potential customers walking around."
The potential for business is not lost on Eddie Flores, president of L&L Franchise Inc., which will operate its Wal-Mart outlet under its mainland name, L&L Hawaiian Barbecue, rather than the more locally familiar L&L Drive-Inn.
"We are very excited. That site should be a blockbuster for us," Flores said. The Wal-Mart location will be L&L's 50th in Hawaii, and Flores said it should "rank in the top five" in sales.
Flores said he believes Wal-Mart -- which counts only McDonald's as an in-store tenant at its existing Oahu stores in Kunia and Mililani -- aimed for a locally flavored tenant mix partly out of public-relations concerns. The Keeaumoku superstore has met opposition from some local residents concerned that the complex will bring increased traffic to an already congested area and saddle smaller kamaaina businesses with increased competition.
John Breinich, chairman of the Ala Moana/Kakaako Neighborhood Board, said Wal-Mart has taken some steps to mitigate these concerns, such as widening streets, installing additional traffic signals and modifying sidewalks and curbs. But he said it remains to be seen whether these steps will have an appreciable impact.
"It doesn't matter who the tenants are. We're still very concerned about the impact on the community," he said.
Sofos said the store will pull large numbers of cost-conscious shoppers to the discount retailer but that the silver lining will be increased patronage of local businesses throughout the area. Similarly, Waikele gained business after the completion of the H-3 freeway, which allowed Windward Oahu residents easier access to its factory-outlet stores, Sofos said. Meanwhile, Windward Mall in Kaneohe suffered.
"Businesses in the area will do better all around," she said.
Sofos added that the Wal-Mart complex completes the retail picture in the greater Ala Moana area, now characterized by the mid- to high-end retail offerings available in Ala Moana and the food and entertainment businesses that predominate at Victoria Ward Centers.
"Any time you add a new component, you have synergy, and synergy is good for everyone," she said.
