DFS Group marked the grand opening of its DFS Waikiki store Thursday, representing a post-pandemic sign of progress and vote of confidence for the state’s top tourism district.

DFS Chairman and CEO Benjamin Vuchot, who is based in Hong Kong, was in Hawaii to unveil DFS Waikiki’s new look. Vuchot said he wanted to underscore the longtime retailer’s commitment to Hawaii, which was cemented in 2022 by the signing of a new 18-year retail lease.

“We have been here for 60 years. Why would we cut short our next journey?” Vuchot said.

But there’s no doubt that the journey is evolving.

Mackie Tan, DFS vice president of global corporate affairs, said the significant renovation is consolidated into a 50,000-square-foot, first-floor footprint versus the former 150,000-square-foot space at 330 Royal Hawaiian Ave.

The consolidated space and new design will assist DFS Waikiki in pivoting from its traditional base of international shoppers to include locals and Hawaii’s core domestic visitor market, company officials said.

Vuchot said excise-tax-free purchasing at DFS Waikiki, which features 100 retail brands, including 45 from Hawaii, is available to shoppers who come without a passport or boarding pass.

“While we are patiently preparing for the return of international travel, we also know that there is a lot of volatility and it could take a long time,” Vuchot said. “So in the meantime we’ve embraced this pivoting and we are welcoming all the shoppers whether they live on the island or whether they come from the mainland, and we give them a reason to celebrate Hawaii and a reason to shop.”

This latest investment marks the third major reinvention for DFS Group on one of the prime retail corners in Waikiki.

“The way that DFS has decorated this time has a very good Hawaiian sense of place — there’s a local feel to it as well as the terrific retail presentation that you would expect from DFS,” said Rick Egged, president of the Waikiki Improvement Association.

The carpet suggests waves, and there is a floral canopy of lacy white tropical blooms that culminates in an Instagrammable floral wall with a neon “aloha” sign. Another Instagrammable spot is a wall of lei, with the greeting “E Komo Mai” above them.

Surfboards, which will be eventually be donated to a local surf school through a community charitable partnership, serve as retail displays.

The redesign is more low-key than DFS’ previous reinvestments at the space.

DFS Group in 2001 spent roughly $65 million creating the “Waikiki Walk,” which featured two levels of retail stores in a space designed to resemble the 1920s. There were mock-ups of Iolani Palace, the Moana Hotel, a giant hau tree, the Dillingham Transportation Building and a Honolulu Harbor pier next to the “Spirit of Aloha” passenger liner.

The ceiling of the 2001 renovation was made to look like the sky, and turned from blue to orange at the top of each hour to simulate the sunset backed by an image of Diamond Head.

Six years later, however, the re-creation that could have fit well on the Las Vegas Strip wasn’t delivering expected results, so DFS spent another $45 million converting the space into a modern layout of luxury retail boutiques.

DFS faced significant challenges from the coronavirus pandemic in 2020 and shuttered its Waikiki retail complex, which finally held a soft opening in July.

The reopening, which is the last store to reopen for DFS Group following the pandemic, creates jobs for 200 DFS employees, 90% of whom are returnees.

Eric Nunies, DFS Waikiki’s human resources manager, said many employees, including himself, have worked at DFS Waikiki for decades.

“When we first opened back in July and we opened the gates on Kalakaua Avenue and the guests started to come in, it was a tearjerker,” Nunies said. “We didn’t want to leave and now we are back. It’s great to see everyone working again.”

DFS had significantly more Waikiki employees and retail space in the past, but company officials say they could deliver more phased investments, especially once international arrivals recover. DFS was hard-hit when visitor arrivals from Japan plummeted during the pandemic, and is still exercising caution as that market continues to lag.

“The impact of COVID has been massive for us,” Vuchot said. “It’s been really hard in Hawaii. While we aspire to build back the business to its former glory and beyond, we also are being prudent about how we do it. Success is infectious. We’ll grow as fast as we can and take our teams and our community with us.”

Eric Takahata, managing director of Hawai‘i Tourism Japan, said unfavorable exchange rates coupled with U.S. inflation continue to constrain the Japan market’s recovery. He said the Maui wildfires also have had a slight impact as some “Japanese, out of respect, don’t want to visit a disaster area.”

However, Takahata said, Japanese arrivals have recovered to about 40% and hopefully will improve.

As the recovery of international arrivals progresses, the potential grows for further partnerships between DFS and its landlord BlackSand Capital, which acquired the DFS building and the high-rise office portion of the building in August 2021.

The finance company paid $270 million for the space, which comprises 155,000 square feet of gross leasable area plus a parking garage.

B.J. Kobayashi, BlackSand Capital chair and CEO, and founder and senior partner for developer Kobayashi Group, said in an earlier interview with the Honolulu Star-Advertiser that discussions about further redevelopment at the site are taking place.

Vuchot said the focus now is on bringing back the store at the center of Waikiki and ensuring that it stands for excellence and success, while pivoting to a new model.

“The Hawaii of today is slightly different to Hawaii before the pandemic, and we need to celebrate the customers in a different way,” he said. “I’m confident that this reopening and this stage in our DFS history will pave the way to many more exciting ventures.”

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Star-Advertiser staff writer Andrew Gomes contributed to this report.