Days after the long-awaited opening of Hollywood & Highland, hammering could be heard outside the Me Gusta Mexican Caf & #233;, boxes sat on the display floor of Aveda, and construction workers labored at the Green Earth Caf & #233;.
Operator TrizecHahn Development Corp. and Los Angeles city officials continued working to improve parking and alleviate traffic on surrounding streets of the huge site that includes the Kodak Theater.
The city, which owns the theater and the underground parking structure, had yet to finish working out plans for an additional city-owned parking lot that would provide 1,500 new spaces behind the nearby El Capitan Theatre.
Also pending was a lawsuit by the Hollywood Heights Homeowners Association against the city and TrizecHahn regarding the prominent signage outside the entertainment complex.
Such was the first week of the Hollywood renaissance.
But such concerns did little to dampen the hopes pinned on Hollywood & Highland. The crowds that turned out for opening day and the following weekend seemed to only bolster the expectation of a revival along the once neglected boulevard.
“It’s been the best thing that’s happened in the last five years that I have been here,” said Kerry Morrison, executive director of the Hollywood Entertainment District Property Owners Association. “It seems that almost overnight Hollywood Boulevard has been transformed.”
Initial sales good
While the $615-million project attracted large crowds in its first days, some kinks had to be worked out, such as improving the signage directing shoppers to restrooms and ATM machines.
“Your first weekend, you go through growing pains making sure things work.” said Russ Joyner, vice president and general manager of Hollywood & Highland. “We learned a lot.”
Conceding he got a late start setting up shop, Mitch Siegal, owner of Book City at the complex, said his preparations were slowed by traffic coming into the building and crowding on the loading dock. He opened without completing construction and fully stocking his book and Hollywood memorabilia store.
“(The construction workers) couldn’t get in,” he said, sitting in his still sparsely stocked store last week. “I wish I could’ve gotten everything done.”
Joyner said merchants were given eight to 10 days to prepare for the opening and a transportation and loading dock manager was on hand to oversee the work. Only about 40 of the 80 retail and restaurant spaces, most of which have already been leased, opened on Nov. 9.
Some 300,000 people came through Hollywood & Highland in the first four days and sales were above projected levels, Joyner said. He declined to release specific sales figures. Despite the large crowds, the 3,000-plus parking lot was never filled to capacity, he said. While shuttle trips from the Hollywood Bowl were provided on the first weekend, there were no plans last week to make it a regular service.
Curiosity about Hollywood & Highland is certain to draw both tourists and locals for some time. That could generate healthy sales at the complex this holiday season despite the slump in consumer spending that has hurt high-end retailers, said Richard Giss, a partner in the retail services group of Deloitte & Touche LLP.
“Coming into a holiday season, it’s better to be the new kid on the block than the old guy,” he said. “The newness and the attraction of it will carry (retailers) through the holiday season.”
Given the decline in travel since the Sept. 11 terrorist attacks, Hollywood & Highland will have to depend more heavily on local visitors until tourism in the area returns to normal levels. Retailers said last week that at least half of the people coming through their stores appeared to be locals.
“A lot of people are very excited and they say, ‘It’s about time. Now we can show tourists something better,'” said Martha Askew, who runs the All That Glitters accessories cart with her three daughters.
Karen Vasquez, a 19-year-old who watched Hollywood & Highland go up while an employee at Grauman’s Chinese Theatre, eagerly awaited the opening of the complex. She and her mom, Martha Vasquez, made their first visit last Tuesday.
“This is like the new place to be at. It’s so alive,” Karen said.
The center stands to gain a stable base of local visitors once much of the vacant office space in the area is filled. There are 500,000 square feet of commercial space waiting to be leased around Hollywood & Highland, according to John Tronson, a principal at Ramsey-Shilling Commercial Real Estate Services Inc.
“You’re going to have a whole new daytime population that’s using (the complex),” he said.
Merchants in the surrounding area were still waiting last week to see if the opening of Hollywood & Highland would give a boost to their businesses.
“We really have not seen much change except you see, perhaps, more tourist traffic,” said Zaid Awni, owner of Imagexperts, a photo developing shop on the corner of Hollywood and La Brea Avenue. The one major change that Awni, a 17-year-veteran of the boulevard, has noticed is in the rent he is paying this year.
“Landlords think that (Hollywood & Highland) is going to help with the business around the area therefore it justifies raising rents,” he said.
While Hollywood & Highland is expected to increase foot traffic, it could also bring higher rents and more competition to the small, independent stores nearby. The many souvenir shops must now vie for shoppers with the flashy behemoth on the corner.
“Over time, there’s going to be a natural churning of the retail opportunities,” Morrison said. “Not to say that we ever will or want to get rid of all the quasi-tacky or whimsical stores because frankly that does add to the whole Hollywood experience.”
