REDEVELOPING: A picture of Umami Burger at Fred Segal taken in 2012. The compound around the Umami Burger will be redeveloped.

REDEVELOPING: A picture of Umami Burger at Fred Segal taken in 2012. The compound around the Umami Burger will be redeveloped.

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Boutiques Ordered to Vacate Fred Segal Santa Monica

The 500 Broadway building of landmark retailer Fred Segal in Santa Monica, Calif., is closing to make way for the construction of a new structure, and the 500 Broadway boutique owners in the building were recently notified that they must vacate by the end of May.

Ron Robinson, the owner of the 5,000-square-foot Ron Robinson boutique in the 500 Broadway building, said some tenants hope to negotiate an extension with the building’s owner, DK Broadway LLC. The company is part of KRE Capital, which is headquartered in Beverly Hills, Calif. In a low-profile deal, the 500 Broadway building was acquired for $41.2 million in May 2012.

“It would be an easy decision to leave if we had not developed and matured such a nice customer following,” Robinson said. He employs 12 people at his Santa Monica location. He plans to give them new jobs at his Ron Robinson boutique at the Fred Segal compound at 8100 Melrose Ave. in Los Angeles. However, he may not be able to find jobs for all his Santa Monica staffers.

“We’ve been there 18-plus years,” Robinson said. “The mood is difficult. The emotions are difficult. We’ve developed such great clientele. We’re not done. We’ll find another Westside location. Our Melrose location continues to be very strong.”

The 500 Broadway building of Fred Segal, often called Fred Segal Santa Monica, has been home of more than 12 retailers, including Ron Robinson, Fred Segal Finery and the popular Umami Burger at Fred Segal. Fred Segal Santa Monica is spread across two buildings. The retailers in the 420 Broadway building, across the street from 500 Broadway, have not been asked to leave, and there is currently no news on redeveloping the 420 Broadway building.

A representative for Fred Segal said that some boutique owners from the 500 Broadway building will move to the 420 Broadway building. “DK Broadway … is currently working with those tenants on transition plans. The redevelopment of 500 Broadway does not have any impact on the Fred Segal [Melrose] location, and the Fred Segal location at 420 Broadway will continue to operate uninterrupted,” said Jessica Kleiman, executive vice president for Sandow, a New York–headquartered company that owns rights to the Fred Segal name. Sandow acquired the world rights to the Fred Segal brand for an undisclosed amount in 2012. Sandow is scheduled to open seven Fred Segal stores at the SLS Hotel and Casino in Las Vegas this summer and a store in Tokyo in fall 2015. Sandow does not own Fred Segal Santa Monica and Fred Segal Melrose.

Executives from DK Broadway did not return an email and a phone call by press time. However, the company’s plans for the property were outlined on the website for the planning division of the city of Santa Monica.

There will be 250 units in the building—30 three-bedroom units, 54 two-bedroom units, 126 one-bedroom units and 40 studio units. The building will offer 561 parking spaces and some commercial uses, but it was not specified what commercial uses will be featured in the building. The building also is seeking LEED certification, which is a certification that the building has met eco-friendly standards.

For years Fred Segal Santa Monica has been one of the premier shopping venues in Santa Monica. As the city has increasingly become a magnet for affluent people and high-marquee tech and media businesses, more retailers have moved to the beachside area. Developer Macerich redeveloped the Santa Monica Place retail center in 2010, and the popular mall has become the address for popular retailers such as Bloomingdale’s, Nordstrom and Kitson. Consequently, the fashion boutique business has become much more competitive, said Ilse Metchek, president of the California Fashion Association trade group and a resident of Los Angeles’ Westside since the 1950s.

“The stores have to have good stuff. They have to be right for the customer. The consumer is smarter in Santa Monica,” Metchek said. “It will change the character of Santa Monica. [Many stores] will go someplace else. They’ll go to places that are hot and new. It is what happens in our world."