A condominium tower and rental apartment complex planned across from Honolulu Community College in Kapalama is the latest large-scale effort by Hawaii developers to ease Oahu’s tight supply of housing.
The 310-unit project dubbed Kokea Center is envisioned by local developer Stanford Carr adjacent to a planned city rail station at the corner of Kokea Street and Dillingham Boulevard.
Carr shared details of his plan with a gathering of Oahu real estate agents Friday during a Honolulu Board of Realtors forum at which some of Hawaii’s biggest residential developers talked about their contributions to the local housing supply currently being outstripped by demand.
“There is a housing shortage,” said Mary Flood, vice president of sales and marketing for the Schuler division of home builder D.R. Horton. “The inventory is shrinking.”
Two years ago economist Eugene Tian with the state Department of Business, Economic Development and Tourism warned that the formation of new households on Oahu was happening faster than the formation of new homes.
DBEDT published a study last year projecting the need for about 65,000 new homes statewide over 10 years, or 6,500 annually, while closer to 3,000 homes a year have been built in recent years.
Flood and others at Friday’s forum said there isn’t enough new primary housing slated to come on line in the next few years to affect much of the imbalance.
At Horton the company has about 350 more homes to build in Kapolei at its 1,000-home Mehana project, which Flood said likely will be done by the end of next year.
A groundbreaking ceremony for another Horton project on the Ewa Plain, Ho‘opili, was held two weeks ago. Yet sales for an initial phase of about 300 homes aren’t projected to begin until the end of next year with completion of the first homes in early 2018 because sewer lines, roads and other infrastructure need to be installed on what is now farmland that will become the master-planned community with 11,750 homes.
“It’s not too long off,” Flood said, referring to the initial phase of Ho‘opili homes. “It’s going to be coming along in the next year and a half.”
To illustrate the high demand for homes priced around the middle of the market, Race Randle, vice president of Hawaii development for Howard Hughes Corp., said prospective buyers picked up about 2,800 applications in just under a week for a planned condo in Kakaako called Ke Kilohana where 375 units are priced between $323,475 and $560,774.
On the first day applications could be picked up, March 26, a line of 500 people had formed, Randle said. “That line didn’t stop,” he added. “We’re doing our best to create a lot of housing stock in the urban core.”
Construction of Ke Kilohana is expected to start by the end of this year and take about two years to complete.
Hughes Corp. also is developing four luxury condo towers with average unit prices at or above $1 million at its Ward Village master-planned community, of which three are under construction and slated to be completed between the end of this year and 2018.
Richard Hobson, vice president of sales and marketing for Gentry Homes Ltd., said there just isn’t enough undeveloped land on which to build big communities like Ho‘opili, Mililani or Hawaii Kai like there was several decades ago on Oahu.
“There’s not a lot left for us to work with,” he said.
Gentry is pretty much temporarily out of new-home inventory at its master-planned community Ewa by Gentry. “We’re out of homes,” Hobson said, noting the empty inventory should be replenished starting this summer when the company starts the first of two remaining phases totaling about 1,000 homes.
Kathy Inouye, chief operating officer of development firm Kobayashi Group, said the future trend for housing development on Oahu is expected to largely revolve around the city’s transit line where developers can obtain density bonuses for projects within a half-mile of train stations.
Carr’s Kapalama plan is an example of that, along with a tower called Keauhou Place that he has under construction in Kakaako adjacent to a planned rail station at the corner of Halekauwila and Keawe streets.
Carr envisions developing Kokea Center to coincide with construction of the city’s rail station adjacent to the project site, though he said he is still negotiating details with the parcel’s landowner, Kamehameha Schools. Building the station could be four years or so away.
