Closeout sale at Hilo Hattie

A one-of-a-kind sale is happening at “The Store of Hawaii.”

Hilo Hattie began an effort Tuesday to sell pieces of its flagship store — from signs and vintage aloha shirt displays to garment racks and cash registers — as the kamaaina retailer working to emerge from bankruptcy prepares to shutter operations in Iwilei, where tourists arriving by the tour busload could not sustain the business.

A “400XL”-size aloha shirt with a 5-foot-diameter neck opening that was recognized by the Guinness Book of Records in 1999 as the biggest aloha shirt in the world is among the items being liquidated, with an estimated price around $1,000.

The store at 700 N. Nimitz Highway will close Monday evening.

To prepare for the exit, the company has discounted merchandise generally by 25 to 30 percent and is selling nearly all the fixtures, furniture and equipment in the 87,000-square-foot building, which serves as a retail store, warehouse, distribution center and management headquarters.

“This is a tremendous opportunity,” said Mark Storfer, Hilo Hattie’s chief operations officer, explaining that some unique memorabilia such as a 10XL-size aloha shirt made for Hawaii-born sumo champion Konishiki and vintage aloha shirts from the early 1940s are being sold.

There are also a lot of run-of-the-mill items such as shelving, laundry carts and an old-fashioned overhead projector. Even the store’s roadside signs with the company’s name on a red hibiscus are up for grabs.

Everything that’s for sale, excluding merchandise, is being sold by Oahu Auctions, which might hold an auction before Hilo Hattie has to return the building to the landlord Oct. 31.

“It really depends on how much we have (unsold) next week,” said Alicia Brandt, a principal with Oahu Auctions.

The sale already has attracted other companies looking for bargains. Tour transportation firm Roberts Hawaii bought a $10 vacuum cleaner. Young Laundry bought several garment racks. And the YMCA bought two drafting tables for $30 each.

Storfer said the priciest item will be a multistory garment movement and storage system that uses motorized rails to store and retrieve garments. He said the modular system cost close to $250,000 35 years ago. “It’s probably the best item in the whole place,” he said.

Hilo Hattie is taking about a third of the system to a new 11,000-square-foot warehouse in Kakaako that also will house e-commerce shipping, office and uniforms, and corporate sales operations.

Proceeds from the Oahu Auctions liquidation will go to First Hawaiian Bank, a creditor in Hilo Hattie’s bankruptcy that has a lien on the retailer’s fixtures, furniture and equipment.

Hilo Hattie filed for Chapter 11 bankruptcy protection in February, listing $8.1 million in assets and $13.2 million in debts.

The 52-year-old retailer had closed three of seven stores — in Kihei, Kailua-Kona and Hilo — right before filing for bankruptcy. Following the closure of the Iwilei store, Hilo Hattie will have two stores, at Ala Moana Center and in Lihue.

Merchandise from the Iwilei store not sold before Monday will be transferred to the remaining stores.

Storfer said the company is searching for retail space in Waikiki for a new store.

Moving out of the Iwilei property is helping resolve much of Hilo Hattie’s debt that was held by an affiliate of the Harry & Jeanette Weinberg Foundation, which owns the property and bought Hilo Hattie out of its lease.

All Hilo Hattie creditors are expected to vote soon on a plan to erase a portion of the retailer’s remaining debts. If a U.S. Bankruptcy Court judge confirms the reorganization plan, Hilo Hattie is expected to exit bankruptcy in early January.