$1 million condos planned for Hawaii Kai
Pacific Business News (Honolulu) - by Nina Wu Pacific Business News
One of the last significant buildable parcels in Hawaii Kai will be used for a 300-unit luxury condominium complex called Hale Alii with starting prices at about $1 million.
The site at the foot of Mariners Ridge was once planned for housing for the elderly, but the developer says demand for high-end homes prompted the change in the scope and marketing of the project.
Mike Klein, marketing director of the development team, 21st Century Homes, said the 3.5-acre site is the last remaining developable parcel in the area. The project would be adjacent to the existing D.R. Horton Schuler development at the corner of Hawaii Kai Drive and Keahole Street.
The design of the $120 million project will feature two separate buildings behind a security gate, a small park, waterfalls and a putting green. The developer is seeking a variance to allow him to build two 90-foot-high buildings, 30 feet above the current maximum allowed.
Two- and three-bedroom units are expected to go on the market this summer, with an average starting price of about $1 million.
Klein said the project is on par with new luxury towers like Hokua at 1288 Ala Moana Blvd. and Watermark Waikiki, which have found strong demand.
He expects second-home buyers, wealthy retirees and downsizing baby boomers to be prospective clients.
Hale Alii may seem like yet another development capitalizing on the residential high-rise boom, but the project has been on the drawing board for more than five years.
21st Century Homes bought the corner parcels from Moanalua Associates in 2000, and since then the project has been a "moving target," said Joe Brown, president of the company.
Klein also is the founder of the Hawaii Intergenerational Community Development Association, which developed the neighboring Kaluanui Senior Apartments in Hawaii Kai about two years ago.
While the original intention was to create more senior homes, those plans changed as construction costs skyrocketed.
"Construction costs have risen so much in the last three years, all you can afford is high-end so that the budget's not upside down," Klein said.
Groundbreaking should take place within a year, with completion expected in 2008.
Though he is one of the last developers out with a project, Klein is confident there will be buyers for the luxury units this summer.
"It's all subject to supply and demand in a particular area," he said. "It's the only product available other than Stanford Carr's."
Real estate analyst Ricky Cassiday agreed, noting that the prices are similar to what the Hokua asked for, at $600 per square foot.
"The high end of the market is more than capable of absorbing all those units, if they're really good units," he said.
Klein is still negotiating the final details for the second building, on a lot behind the one fronting Hawaii Kai Drive, with another investment partner.
A new gate should soon go up at the site, replacing a temporary white picket fence. A sales center also is planned for the site this summer, with East Oahu Realty as the project's broker.
Hawaiiana Management is signed on to manage Hale Alii.
Designs by Honolulu firm CDS International call for two concrete buildings, with underground parking. Current zoning allows for 60-foot-tall buildings, but the team will seek a variance allowing them to build higher.
Prior zoning allowed for a height of 150 feet, until it was changed in the mid-1980s after the proliferation of condominium towers along Hawaii Kai Drive.
Though it initially provoked resistance from anti-development community groups, 21st Century's final design plans were approved by the Hawaii Kai Neighborhood Board.
Klein said he still envisions a senior housing project being built on the parcel that his partnership owns between the Oahu Club and Hale Alii, but those plans are still in development.
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