Hawai'i Community Development Authority

Honolulu Star-Advertiser

Final Phase emerging for Ward Village’s master-planned community in Kakaako

By Andrew Gomes  June 16, 2024

CRAIG T. KOJIMA / [email protected].
Construction continues in Ward Village, seen here from Ward Avenue, as high-rise luxury condominiums have become part of the changing landscape of Kakaako over the years.

Completion of a 15-year-old master plan for the Ward Village community in Kakaako is on the horizon, with pieces being arranged for what may largely be a final phase.

Howard Hughes Corp., the developer of the high-rise neighborhood, is working with a state agency regulating development in the area to determine many remaining elements of the 60-acre project approved in 2009.

Some of these components tentatively are to include opening up a dead end of Auahi Street and turning part of the roadway into a pedestrian promenade, installing community gateway signs and selling a piece of land to the state.

Four condominium towers not yet under construction also have been approved, and would join six completed towers and four under construction.

It could be several more years to complete all this work, given that building a tower takes about two years. It’s also possible that unanticipated economic events create setbacks. But the end is approaching for turning a remnant of a kamaaina family estate that became a collection of decades-old retail centers, warehouses and office space into roughly 6,000 mostly luxury condos in at least 14 towers mixed with retail, restaurants and parks costing well over $6 billion.

Through a spokesperson, Doug Johnstone, Hawaii region president of Texas-­based Hughes Corp., was not willing to disclose whether additional residential and retail development is intended beyond the four announced towers that have not yet begun construction.

“Currently, our local team and partners are focused on fulfilling the vision of live, work, play while delivering new neighborhood parks, open space, and critical area regional infrastructure for Honolulu,” he said in a statement.

COURTESY RENDERING
Construction has not yet started on Ward Village’s 11th tower project, Launiu Ward Village. This rendering shows the planned tower in the foreground at the corner of Ward Avenue and Ala Moana Boulevard.

Shifting plans

The site of Ward Village had long been owned by descendants of Victoria Robinson and Curtis Ward, who built their home, Old Plantation, where Blaisdell Center is today.

Over several decades, the descendants doing business as Victoria Ward Ltd. oversaw piecemeal development on parts of the property that included Ward Warehouse, Ward Centre, big-box retailers, movie theaters, the IBM Building and warehouses collectively known as Ward Centers.

Victoria Ward had pursued an upscale redevelopment of the property since the early 1990s, and at one time the company’s plan included an 800,000-square-foot shopping center along with several residential towers.

In 2001, Victoria Ward solicited buyers for what was then a 65-acre complex. That effort resulted in a 2002 sale to the then-owner of Ala Moana Center, Chicago-­based General Growth Properties, which paid $250 million, including $50 million in assumed debt.

General Growth, after selling a parcel to local developers who produced the luxury Hokua condo tower in 2006, obtained a broad framework for redeveloping Ward Centers in 2009 from the Hawaii Community Development Authority, a state agency regulating development in Kakaako.

Under HCDA rules, developers can produce buildings as tall as 400 feet if they also contribute public benefits that include public park space and making 20% of residential units affordable to moderate-income households.

General Growth’s “Ward Neighborhood” master plan envisioned up to 4,300 homes in 20 buildings, space for 400 retailers, three landscaped pedestrian plazas and 700,000 square feet of industrial space. An actual number of residences is limited by total floor area as opposed to units under the approved plan.

Hughes Corp. acquired the Ward property in 2010 as part of a bankruptcy reorganization of General Growth, revised several elements in the flexible development plan and completed an initial tower, Waiea, in 2016 at what was rebranded Ward Village.

Waiea established a luxury focus of the new plan, with condo units in the tower selling for $3.6 million on average, not including two grand penthouses that were offered for $35 million and $36 million but failed to sell. To date, the priciest purchase in Waiea was $16 million in 2021 for a pair of previously unsold penthouse units.

Tower multiplication

The next two Ward Village towers built were Anaha, where units sold for $1.2 million on average, and Ae‘o, which includes a Whole Foods Market and residences that sold for $1 million on average.

The first moderate-priced condos filled most of the next tower called Ke Kilohana, which opened in 2019 and included a Longs Drugs store. Most units in this tower sold for around $300,000 to $600,000.

Ward Village’s fifth tower, ‘A‘ali‘i, included 602 luxury units and 150 moderate-­priced units. A couple of more luxury towers followed. One of these, Ko‘ula, was finished in 2022. The other, Victoria Place, is slated for completion by the end of the year on part of the former site of the Ward Warehouse retail center.

Two other towers are also under construction, The Park Ward Village with luxury units and Ulana Ward Village with moderate-­priced units. Hughes Corp. in March reported that The Park, Ulana and a luxury tower called Kalae that recently began construction were sold out or nearly sold at the end of 2023.

An 11th tower at Ward Village, a project called Launiu Ward Village, had attracted buyers for 182 of its 485 units at the end of March, according to the developer, after sales began in February. Construction has not yet started on Launiu, which is projected to open in 2027.

In March, Hughes Corp. announced plans for its next two towers, ‘Ilima Ward Village and Melia Ward Village. They are slated to replace the Ward Centre retail complex fronting Ala Moana Boulevard on the makai side of the community.

In a departure from prior Ward Village tower projects carried out by Hughes Corp., ‘Ilima is to be developed with a joint-venture partner, Arizona-based Discovery Land Co.

Hughes Corp. also recently announced that its 14th tower site at Ward Village will be occupied by a project called Mahana tentatively envisioned with 340 units on the mauka side of the community.

All told, 5,839 condos are to be delivered among the 14 towers, though the number of residences could go up depending on possible changes as part of a tentative agreement between HCDA and Hughes Corp. to update master plan conditions after the original 15-year regulatory framework expired in January.

Pending commitments

The agency and the developer have been discussing proposed terms of an updated agreement since 2023, and HCDA’s board on June 5 voted to authorize the agency’s executive director to sign a nonbinding letter of intent describing acceptable terms.

One pending tweak to the master plan will give HCDA about a half acre of Hughes Corp. land outside the Ward Village footprint in return for allowing more residential density in the planned Ma­hana tower than currently allowed.

The parcel, at the corner of Ward Avenue and Kapiolani Boulevard, is occupied by a small office building and a Jack-in-the-Box restaurant.

Craig Nakamoto, HCDA executive director, said a potential future use of the site hasn’t yet been determined but could include housing.

To compensate Hughes Corp. for the parcel, which has an estimated value of about $8.5 million, HCDA would convey to Hughes Corp. density rights the agency holds for land in Kakaako it owns. This additional 113,000 square feet of floor area is valued at $75 per square foot, or about $8.5 million.

No change is expected with the number of moderate-priced homes Hughes Corp. has to deliver because the developer previously more than satisfied its 20% requirement for all planned housing at Ward Village with the 697-unit Ulana project under construction and units in ‘A‘ali‘i and Ke Kilohana.

One proposed change could alter the amount of industrial space at Ward Village. Since HCDA’s formation in 1976 to facilitate redevelopment of what had become a largely run down industrial area, the agency has promoted a mix of residential and commercial redevelopment that includes space for light industrial tenants.

Hughes Corp. has received development density bonuses for the amount of industrial space that exists at Ward Village, but this amount could be reduced under the proposed regulatory changes if the company pays HCDA for the value of the bonuses it received at a price of $75 per square foot adjusted for inflation.

Some of this industrial space exists in old buildings on the Ewa side of Ward Avenue in an area Hughes Corp. calls West Village. The company declined to say whether or how it plans to redevelop this area. On prior Hughes Corp. development maps, the area is indicated for redevelopment.

Other proposed conditions of an updated master plan would require Hughes Corp. to extend Pohukaina Street to Ward Avenue and eliminate a dead end on Auahi Street where the city has a baseyard. Hughes Corp. also would be required to improve Auahi and create a pedestrian promenade on part of the street.

Another pending requirement is for Hughes Corp. to install “district gateway” signs at five main entry points to Ward Village welcoming people to the community.

The letter of intent is scheduled to expire Sept. 30 if a binding agreement is not executed by then.

Final phase emerging for Ward Village’s master-planned community in Kakaako