California Apparel News

Los Angeles’ Robertson Boulevard once held some of the most highly coveted commercial real estate in California, but the weak economy has been taking away some of the street’s glitzy luster.

Vacancy rates are climbing on the prime retail strip of Robertson between Third Street and Alden Drive. Some veteran boutiques are moving off of the street, which once saw celebrities such as Paris Hilton, Lindsay Lohan and Britney Spears window-shopping for unique fashions.

More than four boutique spaces will be available in the upcoming year on Robertson. The most prominent among them is the site of the former Robert Clergerie boutique at 108 N. Robertson, which has been vacant since May. The site of former Agnes B store at 100 N. Robertson has been vacant since the store closed in September.

Boutiques Madison and Diavolina will be moving off of the 100 block of South Robertson in mid-2009. Both will be reopening on Los Angeles’ West Third Street in April 2009, said Evelyn Ungvari, founder of Diavolina, which is owned by Madison. Their new digs are a few hundred feet from Robertson. Madison owner Mark Goldstein said the 7,000-square-foot building, a former antiques shop, will offer slightly more selling space, with areas for office and e-commerce stores as well as a rarity—a parking lot with 20 spaces. “I feel like we will still be part of the street. We will still have access to our customers, but it will be more exclusive,” he said.

Ungvari said Robertson’s rents had become too expensive to do business in a flagging economy. In addition, Goldstein said the street’s character has changed from its roots as a street for independent boutiques. “It’s become a corporate street,” he said. Ungvari agreed, saying the street’s customer is becoming less elite and more mainstream, and the new crowd is less interested in new, unique fashion.

According to Fraser Ross, who owns and manages the street’s four Kitson boutiques, Robertson’s customers are often travelers staying at one of the luxury hotels in the Beverly Hills area. He agreed with Ungvari that it is getting harder to do business on the street. “The landlords got too greedy,” Ross said. “They’re not realistic on what the consumer is spending today,” he said.

Many retailers are still keen on moving to Robertson, said Matthew May, president of commercial real estate firm May Realty Advisors, based in Sherman Oaks, Calif., but “the sense of urgency, which formerly characterized deals here, is gone,” he said. “A lot of prospective tenants are stepping back and saying, ’Let’s see how Christmas goes before we think about moving in.’”

Rents remain high on the street. A square foot of commercial real estate can command prices as high as $20, according to May.

Jay Luchs, a senior vice president for real estate company CB Richard Ellis and a specialist on Robertson, said asking rents on the street have ranged between $10 and $25 per square foot, and he forecasts that new deals will be made for Robertson’s vacant spaces after New Year’s.

For the past four years, independent retailers have been moving off of the street, and internationally known retailers such as Ralph Lauren, Chanel and Ted Baker have been moving to the street. A D&G boutique, part of the Dolce & Gabbana fashion group, opens at 147 N. Robertson on Dec. 15.

In other retail notes, Erica Dee, a 7-year-old shop that brought contemporary fashion and boutique retail to the Corona Del Mar section of Newport Beach, Calif., will close in January. Owner Erica Dee Thomas said she was paying more than $20,000 in rent each month for more than 5,000 square feet in the exclusive area. “We have the wealthiest clientele in the world,” Thomas said about Corona Del Mar. “But the 2008 economy has affected them, too.”

Thomas made the decision to close her contemporary store Erica Dee and Erica Dee Kids after her landlord balked at renegotiating her rent. However, once the doors of Erica Dee’s physical stores close, she will open an e-commerce store at www.ericadee.com. She said the move will free her from paying heavy rent and some labor costs. She said she might open another physical store after the economy improves.