Shop ‘duplication’ alleged

Cindy Frazier

Owners of a number of downtown women’s clothing boutiques are fit to

be tied over plans by a larger retailer to rent the 381 Forest Avenue

location formerly occupied by a Banana Republic store.

The small shop owners plan to ask the City Council on July 19 to

overturn a conditional-use permit granted June 22 by the Planning

Commission to John Parros for his Sophea Parros women’s clothing

store.

The shop owners want the council to invoke restrictions against

“duplication” of retail shops in the downtown area, arguing that the

area doesn’t need another women’s clothing store -- particularly one

that sells the same clothing lines they do.

They also accuse Parros of “stealing” merchandise lines they have

been selling, and they fear the larger retailer could drive them

under by lowering prices.

The owner of the building has also appealed portions of the

Planning Commission’s decision in an effort to allow Parros to set up

shop quickly to capture the sizzling summer retail season in Laguna.

The commission is requiring the retailer to remove walls that

block windows in the 5,000-square-foot space, a requirement the

landlord hopes to postpone by six months.

Parros has a store in Pasadena and is branching out to other

locations in Los Angeles and Orange counties.

“We’re very excited about opening the store in Laguna Beach and

look forward to servicing the community,” Parros said. “We have a

great assortment of women’s clothing, shoes and accessories, and we

try to do the best job we can.”

Alan Hall, owner of Muse, a women’s store directly across the

street from 381 Forest Ave., is leading the charge against Parros.

Hall accuses the retailer of “stealing” an exclusive, best-selling

line of women’s wear right from under Hall’s nose.

“I got a letter from the manufacturer saying they were terminating

us,” Hall said. He believes the manufacturer was lured to the larger

retailer by the prospect of selling his entire output.

Hall believes the Planning Commission approved Parros’ shop after

failing to hear the other side of the story, and says city officials

did not properly announce the issue on an agenda. The June 22 agenda

stated that the commission would consider another shop, Melrose for

Women, which Hall says raised few concerns.

“Melrose was going to carry affordable ‘Melrose Avenue’ style

clothing along with a few designer labels that were not already

represented in town,” Hall said. “Only a few shopkeepers had any

interest in the Melrose proposal.”

Parros, however, specializes in selling designer labels carried by

a number of Laguna shops, rather than bigger companies’ lines or his

own labels.

“Mr. Parros can use his power to secure rights to the most popular

designer lines by taking them away from small, independent, local

competition,” Hall claims.

The Downtown Specific Plan allows officials to refuse to issue

conditional-use permits to shops that are deemed to be detrimental to

the diversity and mix of businesses there.

“If findings [supporting the use] cannot be made, then the

Planning Commission and/or the City Council can deny the use,” said

Ann Larson, a city planner. “If findings can be made, the city can

attach specific operational and performance conditions tailored and

customized to the particular business.”

Hall says he hopes the City Council will at least order Parros not

to carry lines that are already being sold elsewhere in town.

Parros defends his business practices. “The only person who has

the right to determine distribution is the manufacturer,” he said.

“We sell over 100 brands.”

Another women’s retailer, Jeannette Engel of Zazu, located at 303

Broadway, says Parros will carry a dozen of her lines.

“He can hurt my store because he can buy in mass quantities and

sell at a lower price,” Engel said. “He is duplicating what is

already here.”

Engel just doubled the space of her store to 1,000 square feet,

and fears Parros’ store -- on a prominent downtown corner -- will

draw away her customer base.

Planning Commissioner Norm Grossman, the lone no vote against

Parros’ store, says the City Council has in the past denied the right

to set up shop to merchants whose wares were already being offered

locally.

“Duplicating what’s already in town goes against what the

[Downtown] Specific Plan calls for,” he said. “They denied Longs

Drugs because its lines of merchandise were already available all

through town.

“We can’t tell them [merchants] what to sell, but we do tell them

what not to sell,” Grossman added, noting the prohibition on any more

downtown shops carrying T-shirts, bathing suits and ivory. The

specific plan also prescribes the type of jewelry that can be sold,

to avoid a proliferation of mass-produced items.

But Eugene Gratz, a local attorney who represents the 381 Forest

Ave. property owner, doesn’t buy these arguments.

“It’s not true that Mr. Parros is ‘poaching’ -- many of the stores

carry each other’s lines,” Gratz said. “It’s not the function of the

Planning Commission to regulate competition between stores, and it’s

not appropriate. The dress stores in Laguna Beach compete with each

other, and all do fairly well and seem stimulated by the

competition.”

Gratz says the landlord wants only to rent a large space that has

been vacant for more than a year, and that it is difficult to find

retailers that fit the requirements of the downtown specific plan and

can make a profit.

“From the landlord’s perspective, he wishes only to have a good

tenant. It’s hard to rent space in Laguna Beach,” Gratz said, noting

the owner found Parros after a previous proposal to subdivide the

space and lease it to a bank and an existing clothing store, Melrose

Place, fell through.

Grossman, however, argues that, in some cases, it’s in the city’s

best interests to protect existing businesses that may be threatened

by similar merchants.

“The Downtown Specific Plan allows preemptive action [against new

businesses] to keep out over-saturation,” he said. “When businesses

close down, it’s not good for anyone.”

QUESTION

Should the city be able to tell downtown shopkeepers what

merchandise they can sell? Write us at P.O. Box 248, Laguna Beach,

CA, 92652, e-mail us at [email protected] or fax us at

494-8979. Please give your name and tell us your home address and

phone number for verification purposes only.