Could more luxury high-rise towers rise at Hawaii’s Ala Moana Center?

Park Lane Ala Moana 1488 Ala Moana BlvdHawaii’s largest shopping mall, Ala Moana Center in Honolulu, is already home to luxury condominiums ONE Ala Moana and the Park Lane Ala Moana project under construction and may become home to another condo or two in the future, multiple sources tell Pacific Business News.

“There have been many rumors floating around regarding more residential condominiums attached to Ala Moana [Center],” Trevor Benn, president and principal broker of Honolulu-based Benn Pacific Group Inc., told PBN in an email Wednesday.

He noted that the 23-story Ala Moana Building, which houses mostly medical and dental providers, has been discussed as a potential condo development site, as well as the Macy’s location.

Additionally, the nearby 18-story Ala Moana Pacific Center, which has a mix of corporate tenants and service providers, will likely remain an office building since mall owner General Growth Properties Inc. (NYSE: GGP) does not own the entire land area in fee right now, Benn said.

Tenants in these buildings were told that they will get to stay in their spaces beyond 2019, the general manager of the buildings told PBN earlier this year.

Last year, several tenants maintained that Chicago-based General Growth was not extending leases past 2019. But General Growth later began extending leases in both office buildings.

“I think the success of ONE Ala Moana has shown that the mall is a powerful amenity,” Benn said. “Park Lane is nearly 70 percent sold, at record prices averaging $5 million per unit. With a possible rail [transit] stop near the SamKoo project on Kapiolani [Boulevard], you will have a lot of the key elements for a robust walkable community.”

South Korean developer SamKoo Development has plans to build two mixed-use high-rise projects near Ala Moana Center, which includes a total of nearly 1,000 units consisting of both affordable and moderately-priced units, a company executive told PBN in March.

“It remains to be seen, however, what the absorption rate will be for ultra-luxury condos in light of the inventory available,” Benn said. “There are a lot of options for a buyer with millions to spend, but how many buyers are there at those prices?”

Steve Sofos, president of Honolulu-based Sofos Realty Corp., told PBN that the notion of building more residential projects at Ala Moana Center seems to be a trend nationwide, as the live-work environment with housing and retail is becoming stronger in Hawaii’s marketplace.

The recently completed ONE Ala Moana condominium atop the Nordstrom parking garage and Park Lane Ala Moana are part of a growing trend of luxury residential developments being built at shopping centers in the United States.

The Wall Street Journal recently cited several projects similar to the Ala Moana projects, both developed by Hawaii developers The MacNaughton Group and Kobayashi Group. The Howard Hughes Corp., BlackSand Capital and General Growth are also involved in these projects.

The Wall Street Journal noted several factors behind the push behind this real estate phenomenon, including an uptick in the market, the growing need for developers/owners to create walkable, urban environments, as well as these residential developments becoming great investments for all parties involved, including buyers.

Duane Shimogawa
Pacific Business News

Shirokiya owner lists penthouse at ONE Ala Moana luxury condo for $12.5M

A pair of penthouse units at the newly completed 23-story ONE Ala Moana luxury condominium atop the Nordstrom parking garage at Ala Moana Center in Honolulu, — including a combined residence and the grand penthouse owned by Takeshi Sekiguchi, owner of Shirokiya and Vintage Cave Honolulu — are already on the market for a total of $22.3 million.

Sekiguchi, a Japanese businessman who developed the Grand Wailea Resort on Maui and Ko Olina Resort on Oahu, paid about $9.7 million for the grand penthouse, according to public records.

The Nordstrom department store at Ala Moana Center is seen in this photo depicting a rendering of the ONE Ala Moana luxury condominium project, recently completed construction atop the parking garage next to Nordstrom. Two penthouse units are on the market for a combined $22.3 million.

The Nordstrom department store at Ala Moana Center is seen in this photo depicting a rendering of the ONE Ala Moana luxury condominium project, recently completed construction atop the parking garage next to Nordstrom. Two penthouse units are on the market for a combined $22.3 million.

He is now asking $12.5 million for the three-bedroom, three-bathroom 4,069-square-foot unit on the 23rd floor. SRE Matrix, a web-based Honolulu real estate firm that is also owned by Sekiguchi, is the listing firm for the fee-simple unit, which includes 180-degree views of the mountains and the ocean, a lanai and rooftop access.

Amenities include pool, jacuzzi, gym, media room, golf room, party room with kitchen, spa treatment room, barbecue area and kids recreation area. The monthly association fee for the grand penthouse is about $4,370.

The other unit, a combined penthouse unit with five bedrooms, five full- and two half-bathrooms and a second family room that is owned by Lally Family Trust, is on the market for $9.8 million with Heyer and Associates LLC. The combined units were purchased for a total of about $6.5 million, according to public records.

“I think we are seeing some profit taking as there is more inventory of proposed ultra-luxury units coming, especially with the Park Lane [Ala Moana] and Waiea projects [in Honolulu],” Trevor Benn, president and principal broker of Honolulu-based Benn Pacific Group Inc. told PBN in an email. “When an investor can achieve a 50 to 100 percent return so quickly, some will start to look for reinvestment opportunities.”

Facebook founder Mark Zuckerberg, who recently bought hundreds of acres of land on Kauai’s North Shore, has also reportedly purchased several multi-million-dollar units at ONE Ala Moana.

Other well-known buyers in Hawaii who have purchased units at ONE Ala Moana include Steve Sombrero, president of NAI ChaneyBrooks; Henk Rogers, founder of Blue Planet Foundation; Dave Erdman, president of PacRim Marketing Group; Eddie Flores Jr., president of L&L Drive-Inn and L&L Hawaiian Barbecue; Richard Lim, former director of the Hawaii Department of Business, Economic Development and Tourism; Mike Irish, owner of Halm’s Enterprises; Peter Ho, chairman, president and CEO of Bank of Hawaii; Mark Bratton, vice president and investment properties division manager at Colliers International Hawaii; and Sachi Braden, owner of Sachi Hawaii.

Duane Shimogawa Reporter – Pacific Business News

Currently Listed For Sale at ONE Ala Moana

Luxury_Oahu_Estates_$2M -_$3M

Luxury_Oahu_Estates_$3M -_$4M

Luxury_Oahu_Estates_$4M -_$5M

Luxury_Oahu_Estates_$5M -_$6M

Luxury_Oahu_Estates_$6M -_$8M

Luxury_Oahu_Estates_$8M – 10M

Luxury_Oahu_Honolulu_Condos

ONE Ala Moana luxury high-rise expects 2014 completion date

Feb 28, 2014, 10:33am HST UPDATED: Feb 28, 2014, 11:16am HST
Duane Shimogawa Reporter – Pacific Business News

The construction scene at the One Ala Moana ultra-luxury condominium tower being built atop the Nordstrom parking garage at Ala Moana Center.

The construction scene at the One Ala Moana ultra-luxury condominium tower being built atop the Nordstrom parking garage at Ala Moana Center.

The ONE Ala Moana ultra-luxury condominium tower being built atop the Nordstrom parking garage at Ala Moana Center is expected to be completed by the end of this year with units selling for an average of $1.6 million, according to the Howard Hughes Corp., one of the development partners.

The Texas-based developer, part of HHMK Development, which also includes The MacNaughton and Kobayashi Group, provided additional details in its annual report this week.

The developers expect to invest a total of $265.1 million in the project, including construction, sales and financing costs. As of Dec. 31, they had spent $109.4 million, the Howard Hughes Corp. (NYSE: HHC) said.

The project is being financed by a $132 million construction loan, along with two $20 million mezzanine loans from List Island Properties and A&B Properties, a subsidiary of Alexander & Baldwin Inc. (NYSE: ALEX).

In December 2012, all of ONE Ala Moana’s condo units sold within the first two days on the market for an average price of $1.6 million. As of last July, the developers had collected $66.2 million in buyer deposits, representing 20 percent of contracted sales prices.

Among the amenities in the 23-story, 206-unit building are a wine-tasting room, a chef’s kitchen where residents can bring in their personal chefs, and a private salon where personal shoppers from Ala Moana Center stores can bring items to residents.

Luxury_Oahu_Estates_$2M -_$3M

Luxury_Oahu_Estates_$3M -_$4M

Luxury_Oahu_Estates_$4M -_$5M

Luxury_Oahu_Estates_$5M -_$6M

Luxury_Oahu_Estates_$6M -_$8M

Luxury_Oahu_Estates_$8M – 10M

Luxury_Oahu_Honolulu_Condos

Company Disclaimer: Information is deemed reliable but not guaranteed.