Travel retailer DFS Group is overhauling the fairly new wing of its Waikiki Galleria with plans for luxury retail to replace the six-year-old collection of shops and entertainment set amid a streetscape facade of old Hawai'i.

The $45 million renovation is part of a global strategy for the company, and will beef up the presence of high-end fashion brands in Waikiki with boutiques from Emporio Armani, Pucci, Coach, Chloe, Marc Jacobs and Ralph Lauren, among others.

"We want to focus on what we do best and what we stand for — and that is luxury retail," said Sharon Weiner, vice president of business development for DFS Group, a unit of LVMH Moet Hennessy Louis Vuitton.

Weiner also said the change is intended to help attract higher-spending visitors as part of an aim corresponding to the state's strategic tourism plan.

DFS about a year ago made a similar change to its entertainment-themed Galleria on Guam, and plans to also renovate its Hong Kong store with more focus on upscale merchandise.

The Waikiki store, at 180,000 square feet, is the largest of 14 DFS Gallerias, which sell merchandise to the general public as well as duty-free items to customers with a ticket or reservation for a direct outbound international flight.

Most of the duty-free merchandise in the Waikiki Galleria comprises luxury goods mainly marketed to Japanese tourists who account for about 90 percent of DFS' duty-free sales. Other areas feature beauty products, packaged foods and other items.

EXPANDED IN 2001

In 2001, the Waikiki store was expanded by 70,000 square feet to connect the main store with Kalakaua Avenue by leasing and renovating the Nippon Shinpan Building.

Retailers added as part of the expansion included Crazy Shirts, Maui Divers, Tori Richard, Island Heritage and Liquid Planet.

Dubbed Waikiki Walk, the $65 million project was a kind of Hawaiian-style version of Las Vegas imagery, with representations of the Moana Hotel, 'Iolani Palace, a giant hau tree and a Matson passenger steamer docked below a blue sky that turned orange as the sun set behind Diamond Head every hour.

The nostalgic theme evoking the boat-day era of 1920s Waikiki — as well as a two-story, 65,000-gallon aquarium that people could pass through via a tubular stairway — was aimed at reviving some of the life and interest in Waikiki that was lost during the state's economic downturn spanning most of the 1990s.

The project announced in 1999 was one of several initial and bold investments in the area over the past decade.

Parts of Waikiki Walk had been phased out some time ago, such as second-floor retail, a virtual golf experience and nightly hula performances.

Weiner said that in general, Waikiki Walk lost its freshness, especially amid more recent improvement projects such as the recently completed Waikiki Beach Walk retail complex on Lewers Street and an $85 million makeover of the Royal Hawaiian Shopping Center slated for completion this year.

"When your neighbors are looking great, you not only want to keep up with the Joneses, but you want to exceed them, too," she said.

A LANE OF LUXURY

After the renovation, the space will become a lane of two-story luxury stores called Waikiki Luxury Walk, leading to escalators running to the main building's third-floor duty-free level.

Some of the luxury retail stores will move from the main building to bigger, more prominent spaces in the mall-like wing, such as Marc Jacobs, Ralph Lauren, Loewe and Coach. Dior is moving from an adjacent space on Kalakaua to the site of the aquarium. Others will be new to Waikiki, such as Emporio Armani and Chloe.

WORK IN 2 PHASES

Renovation will be done in two phases, with work on one side of the mall corridor slated for completion in September, after which work is to begin on the other side for completion in December.

Renovation work also will extend to the main building, reducing floor space for packaged foods on the first floor and doubling the size of the second-floor beauty department.

An already-completed part of the renovation was a $4.5 million expansion of fine watches and jewelry on the duty-free third floor, completed late last year.

Reach Andrew Gomes at agomes@honoluluadvertiser.com.