Will the Kaka‘ako Condo Boom Ease Honolulu’s Housing Crisis?
With plans for new towers on hold (and a splashy luxury condo scratched), experts are arguing if we’re in a lull or a bust. Either puts an end to the idea that Kaka‘ako would lead to a housing solution. A closer look at O‘ahu’s most intractable issue.
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The Rate of Housing Construction Has Fallen Since the Early 1970s.
infographic courtesy of Ricky Cassiday
Affordable Development After Kaka‘ako
If Kaka‘ako won’t solve the housing shortage, what might? Subsidies made affordable Kaka‘ako go—cheap land, or higher zoning densities than allowed elsewhere. Now, says the HCDA’s Lindsey Doi, “We have no more state land to give.” In addition, luxury builders are balking against any more unflashy concrete-block towers adjacent to their luxury offerings.
Stanford Carr is talking to Kamehameha Schools about low-income housing in Kapālama. Closer to town, Carr, Marshall Hung, Rycroft Place developer Peter Savio and others may try to aggregate small parcels of land in the aging condo corridors along the Ala Wai and in McCully, Makiki and Mō‘ili‘ili. The drawback is these areas lag in terms of infrastructure, unlike Kaka‘ako, which received hundreds of millions of sewer and other upgrades in preparation for development.
That leaves TOD, transit-oriented development, along the 21 rail stations. Carr’s Keauhou Place includes a downtown rail stop and he finds the possibilities intriguing. “Each station is potentially a retail and condo hub that will create body heat,” that is, commerce and street life. Like a relay team passing the torch, the 21 stations could deliver an economic boost, in stages, hopefully keeping Honolulu’s economy on the boil.
The glitch: Unlike in Kaka‘ako, the state doesn’t have the money to underwrite sewers and other infrastructure for rail, pushing it on developers. If taxpayers do foot the bill, it will add another billion to the rail project. If they don’t, TOD may be DOA outside of the urban core.
Anatomy of a Condo
Who’s buying? Who’s flipping? We dug into the Bureau of Conveyances data for one of the new luxury condos to get a snapshot of Kaka‘ako’s condo boom.
ILLUSTRATION INDICATES PERCENTAGES, NOT ACTUAL LOCATIONS IN BUILDING.
PHOTO: COURTESY OF THE KOBAYASHI GROUP
One Ala Moana, opened November 2014
Builder: The Kobayashi Group and The MacNaughton Group.
Owner/developer: Howard Hughes Corp.
Top Selling Point: Located atop Ala Moana Center (old Nordstrom), near Ala Moana Beach Park. Opening prices All 207 condos sold, most $1 million to $2 million, 54 units priced under $800,000 (floors 8 to 14); 6 penthouses at $22.8 million each remain.
What’s Gone Up
One Ala Moana, 2014
Halekauwila Place, 2015
801 South St., 2015
Symphony Honolulu, 2016
400 Keawe, 2016
The Collection, 2017
Keauhou Place & Lane, 2017
Park Lane, 2017
Ke Kilohana, 2018
Will Break Ground Soon
803 Waimanu, TBD
48% The number of houses sold on o‘ahu for cash in the first quarter of 2014
10-12% Rent increase, in Honolulu past two years
90,000 The number of renters qualifying for one of 5,900 public subsidized housing units in Hawai‘i
56% The number of 2015 house sales to international chinese in the u.s. that were cash sales.
13 sites permitted
7 towers under construction
6 towers, permitted, not yet under construction
0 applications pending for new condominiums
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