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Riots Change Place Where Many Shop : Retailing: A lot of stores in Little Tokyo, Koreatown and elsewhere are hurting. But malls near damaged areas are booming.

August 10, 1992|GEORGE WHITE | TIMES STAFF WRITER

In Los Angeles' Little Tokyo, hurt by a sharp riot-related drop in tourism, retail sales have declined 40% to 50% in the past three months, compared to the same period a year ago, and there is talk about bankruptcies and business closings.

At the Baldwin Hills Crenshaw Plaza, however, retail sales have increased 20% to 30% since May 1, compared to that three-month period in 1991, and mall managers are talking about new store openings.

Three months after the riots, the retail scene in Los Angeles is changing. While the drop in tourism has hurt some retail centers, some of the city's big enclosed malls and larger retailers are making sales gains as consumers search for alternatives to the small shops and swap meets destroyed during the disturbances.

And many food giants are poised to fill a supermarket vacuum that expanded with the riot-related loss of grocery stores in sections of South Los Angeles.

Some of this apparent shopping shift also stems from the weak economy, which has prompted consumers to seek the discounts that big retail chains and shopping centers commonly offer, shoppers and retailers say.

"The strong are getting stronger, and many small retailers are really hurting," said Jack Kyser, an economist at the Los Angeles-based Economic Development Corp., a nonprofit business development group. "There appears to be a significant shift in buying habits. Apparently, there's more one-stop shopping."

Since the riots in late April, the retail story in Los Angeles has been a tale of two cities. For some merchants, it has actually been the best of commercial times. For others--those in Koreatown, for example--it has been terrible.

The riots were a cataclysmic event that left much of the city's retail base reeling or in ruins. A recent field survey by Dun & Bradstreet Corp., the New York-based business services giant, identified 2,314 businesses damaged or destroyed during the riots, and 64% of those enterprises were retail operations. Dun & Bradstreet officials say the figures may represent only half of the businesses actually affected.

The impact was felt throughout Los Angeles and some neighboring communities, but businesses in South Los Angeles and Koreatown were among the hardest hit. Most of the retail operations affected were small businesses selling goods such as clothing, food, consumer electronics and furniture--merchandise available at competing malls and large department stores.

"The riots have had a definite impact on the retail sector," Kyser said. "But it's often difficult to determine what is attributable to the riots and what is related to the rotten economy."

Little Tokyo in downtown Los Angeles is a clear casualty of riot-related jitters. Many Little Tokyo gift shops and department stores, enterprises that depend on tourists for much of their sales, have suffered from an abrupt drop in tourism.

"After the riot, sales (in Little Tokyo) began to tumble," said Yoshinori Takamine, president of the 170-member Little Tokyo Business Assn. "People in Japan are not coming to Los Angeles because they are frightened. Many people (in Little Tokyo) will have to close their business by the end of the year if the situation doesn't change."

Takamine said sales in Little Tokyo are down 40% to 50% since May 1, compared to the same period last year. Japan's flagging economy may also account for some of the decline in Japanese tourism.

Frank Kawabe, president of the Japanese Chamber of Commerce of Southern California, says 50% of the businesses in Little Tokyo may fail by the end of the year if there is no rebound.

One of the businesses where sales are down is Mickey Seki & Son, which sells and repairs watches and jewelry, said owner Patrick Seki, who has managed the shop for 20 years.

"This is the worst situation since I've been running the business," Seki said.

Likewise, the situation is becoming desperate for many merchants in Koreatown--an area bounded on the east by Vermont Avenue, on the west by Western Avenue, on the south by Olympic Boulevard and on the north by 8th Street.

Koreatown business--which includes a mix of furniture shops, grocery outlets, consumer electronics stores, restaurants and clothing stores--is down 30% to 40% in the past three months, compared to the same period last year, said Chull Huh, secretary-general of the Korean Chamber of Commerce.

Huh said 2,500 Korean and Korean-American enterprises were damaged or destroyed in the Los Angeles area and many owners of those businesses now have little money to spend in Koreatown. Also, many Koreatown merchants lost inventory to looters--leaving them less to sell. In addition, tourism spending in Koreatown is down since the riots because fewer Koreans are vacationing in Los Angeles, Huh said.

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