Thanks for the memories: escalating rents are pushing souvenir peddlers off Hollywood Boulevard.

HOLLYWOOD Boulevard must be changing. The souvenir stores are disappearing.

In the last six months, the boulevard has lost several of its most visible trinket retailers and with them an array of Hollywood-adorned T-shirts, snow globes and key chains.

Merchants that have more or less thrived by selling tschokes to out-of-towners during what locals consider Hollywood's bad times are pointing at one big factor in their plight: Hollywood & Highland.

The $615 million retail and entertainment complex, which opened in November 2001 and proceeded to founder by upscale shopping standards, nevertheless yanked retail rents in the area up by $2 per foot in some locations, to as much as $5.50 a square foot.

"Right now it's very difficult to stay in business," said Gil Zahavi, who along with his brother Steve owns two Hollywood Boulevard souvenir shops. "The landlords are going crazy. In the last five years, you know with all that's happened, they think they can get all this money. It's crazy."

Some souvenir peddlers said their plight has been magnified by Hollywood & Highland.

When buses of tourists are dropped off in front of the Win A Gift souvenir shop, they head towards the Hollywood & Highland complex, according to clerk Ack Poondee. "They spend all of their time down there," she said. "But they don't have time to shop here after they get back."

The recent closings may only be the beginning. The steeper rents become, the harder it will be for the stores to stay in business, according to John Tronson, principal with Ramsey-Shilling Commercial Real Estate Services.

"That's had a real negative impact on the tourism-based retailers around Hollywood & Highland," said Tronson, who believes that the larger souvenir stores may withstand the shakeout. "Those smaller guys have had a real tough time paying the same amount of rent they have in the past and it's only going to get more difficult."

The replacement tenants, however, are more reflective of the current fast-food times than any long-imagined renaissance of the show-biz community. At the base of the TV Guide building at 6922 Hollywood Blvd., two souvenir sites are being converted into a row of restaurants that includes a Hooters, a Baja Fresh and a Coffee Bean & Tea Leaf cafe. Another, adjacent to the Hollywood Roosevelt Hotel, has been vacant for nearly five months.

"There's too many tourist shops and too many X-rated bookstores," said Sam Cole, general manager of the Hollywood Roosevelt Hotel. "We have a chance to make Hollywood Boulevard look like the Third Street Promenade or Old Town Pasadena. These are places that have changed exponentially because of a change in their retail stores."

Outside Mann's Chinese Theater last week, Heather Aumen, along with her husband and two kids, had come up from Disneyland for the day to check out sites around Los Angeles. But Aumen, like many other visitors, said she wasn't planning on staying in Hollywood very long and that her family certainly wasn't shopping for souvenirs.

"We're not looking to buy anything here," said Aumen, who is from Tucson, Ariz. "This isn't even our main stop."

Compounding matters for the souvenir shops is that recent marketing efforts have focused on people like the Aumens, who live within driving distance. But those tourists don't buy nearly as many Hollywood-branded souvenirs as foreigners, who have largely stayed away since Sept. 11, 2001.

So while the boulevard may have regained its crowds this summer, it's translated into a limited amount of souvenir sales.

"For our business, it didn't do much," Zahavi said of Hollywood & Highland. "The stores there don't seem to be working. It doesn't seem to be bringing in any new tourists."

Brad Bell of Tampa, Fla. said he didn't even want to stop in Hollywood but his wife figured that the Chinese Theater looked too interesting to pass up. Bell said the couple had rented a car and had only planned to drive through.

"Why go into the shops?" he asked.

The Zahavi brothers are banking on better days. Before the summer tourism season they expanded their Highland Avenue store by 25 percent by leasing a neighboring storefront. Along with that, they renovated their store, repainting the walls and installing new carpeting.

"We hope that business will get better in the next few years," Steve Zahavi said. "It can't get much worse than it is. There's only an upside from here."

Their optimism is not universal.

At a souvenir store at 7005 Hollywood Blvd., Georgi Dzhudzhev sat patiently next to several racks of knock-off sunglasses, his store devoid of customers despite the large crowds less than a block away.

The store, which bears no name, has been open three months, and before Dzhudzhev took over it sold magnets.

"Some days is up," he said. "Most days is down."

Rachel Rosmarin and Katherine Wang contributed to this story.