California Apparel News

Los Angeles’ next prominent retail street will be located at the Los Angeles International Airport.

On New Year’s Day 2012, Los Angeles boutique chain Kitson is scheduled to open its first airport boutique at Terminal 7 at LAX, where it will be the first store in the first wave of specialty retail to open at the sprawling airport.

Following the Kitson debut, Hugo Boss, Rip Curl, Bartels’ Harley Davidson, new retail concept Magic Johnson Sports and multi-brand shop Hollywood Styles will open boutiques geared toward travelers passing through LAX. The new stores will be spread across LAX Terminals 4, 5, 7 and 8.

Fashion will not be the only specialty retail category at the airport. The Mattel Experience will open a store at LAX next year, which will showcase the venerable El Segundo, Calif.–based toymaker’s newest diversions. Vroman’s Bookstore, the largest and oldest independently owned bookstore in Southern California, also is scheduled to open a shop-in-shop at a Hudson News location at LAX.

As of press time, there is no vacancy left at the more than 20,716-square-foot retail space, being developed by Hudson Group, which is the owner and operator of airport periodical and concession shops Hudson News. The East Rutherford, N.J.–based retail operator won a bid to develop LAX retail last year. Hudson partnered with four other companies in the bid—Magic Johnson Enterprises, Concourse Ventures, The Zaman Group and Soto & Sanchez, all based in Los Angeles. Concessionaires were required to invest at least $3 million aggregate for tenant improvements associated with the new specialty boutiques.

Hudson and its partners got the bid partly because it focused on bringing Los Angeles brands to the airport, said Michael Levy, Hudson’s senior vice president and chief merchandising officer.

“We got iconic brands in bid—local iconic brands,” he said. “We gave the airport local flair, with fashion involved in it.”

Kitson founder Fraser Ross said opening an airport Kitson is a good idea because the customer base wouldn’t be focused on locals—which is crucial for a retailer building a fleet of international stores. “The airport has huge traffic. The visibility alone is a great advertisement,” Ross said.

At 1,297 square feet, the airport Kitson will be smaller than the typical 3,000-square-foot-and-up Kitson store. Also, in a departure from the traditional Kitson store plan, the airport store will not focus on premium denim. Rather, it will emphasize gifts and accessories—such as fragrances, jewelry, eyewear and books—as well as apparel such as T-shirts. “It will be a great place for people to pass time instead of magazine stores,” Ross said.

The upcoming specialty retail stores at LAX will be located behind the airport’s often headache-inducing security-screening checkpoints. For Ross, the security will help the bottom line. There will be little worry about shoplifting, he said. “No one will steal anything and [risk missing] their flight,” said Ross, who forecasts robust sales of $2 million for this airport store.

Expensive items such as watches will be sold at their full price points at the LAX Kitson. Merchandise will not be sold duty-free at any of the upcoming stores.

LAX’s other fashion stores will mostly focus on accessories and casual clothes, Levy said. Magic Johnson Sports will include merchandise from local sports teams as well as memorabilia. Hudson Group will be handling buying for the multi-line Hollywood Styles shop. The company has yet to confirm which Los Angeles brands it will carry.

Rip Curl will sell T-shirts, fleece, boardshorts, walkshorts, dresses and fashion tops for juniors as well as watches. The 1,000-square-foot store is scheduled to open April 6. The Australian-headquartered surfwear company maintains other airport stores across the world, including Brisbane Airport in Australia and NgurahRai International Airport in Indonesia.

Merchants running airport stores are required to jump through a few additional hoops compared with their colleagues operating at malls or on fashion streets. Inventory must be screened before being delivered to each location, according to Catherine Dickey, a spokesperson for Westfield LLC, one of the largest mall developers and management companies in the world. Westfield has been running an airport retail division, Westfield Concession Management, since 1994.

Each airport has its own screening process for inventory. But screening airport retail employees is the same from airport to airport. Those working beyond security checkpoints must be screened every time they report for work. Opening an airport store also takes extra steps. Entrepreneurs must have their concepts and leases approved by airport authorities before they can open for business.

While specialty retail in airports is well established across the world, airports in Sydney, Singapore and London are known for their specialty retail. American fashion retailers have showed increased interest in developing airport retail in the past few years.

Hudson Group is developing specialty retail at Kennedy International Airport in New York City and McCarran International Airport in Las Vegas. Juicy Couture opened at JFK this summer. Victoria’s Secret, Michael Kors and Bartels’ Harley Davidson have opened at the busy New York airport, too. Zara has opened a couple of American airport stores this year. In the past couple of years, more specialty retail has opened at San Francisco International Airport, which offers boutiques for Burberry, Mango, Coach and Swarovski.

Fashion is increasingly important to multi-national airport concessionaire LS Travel Retail. It recently created a new position in its Asian/Pacific division to develop more fashion and luxury boutiques at airports, said Jane Sell, a spokesperson for LS Travel.” In fashion, our main competition is from the [city center] shops,” she wrote in an email. “We create an offer that can influence and change the customer’s shopping habits, making the airport their preferred shopping location.”

Airport specialty retail could encourage return visits from well-off business travelers, according to James Farnell, president of the Retail Design Institute’s Southern California chapter and a director of design at the Costa Mesa, Calif., office of Little & Co. Airports and hotels might be the only part of a city that business travelers get to see. It’s important that these travelers and other tourists get a good taste of the city from the airport.

“It’s rewarding when you do get some sense of the culture through the fog of travel,” he said.