They aren’t cheap, but moderately priced condominiums in Kakaako coming up for sale in three weeks are expected to be in high demand — so much so that sales will be by lottery.
Howard Hughes Corp. is announcing today that it plans to sell 375 units in a 424-unit tower called Ke Kilohana at 988 Halekauwila St. via lottery April 15.
The homes are reserved for residents who earn not much more than average but can’t afford market-priced homes in Honolulu where million-dollar condos are rising faster than affordable housing.
Prices for Ke Kilohana units that range from 461 to 988 square feet of living space run from $323,475 to $442,246 for one-bedroom units, from $473,789 to $538,612 for two-bedroom units and from $521,774 to $560,774 for three-bedroom units.
Ke Kilohana units are reserved for local residents who earn no more than 140 percent of Honolulu’s median income, a level that equates to $85,150 for a single person, $97,300 for a couple or $121,650 for a family of four.
The Hawaii Community Development Authority, a state agency that oversees development of Kakaako, requires 20 percent of all high-rise homes developed in the area be affordable to a “gap group” of residents who often can’t afford market-priced homes but don’t qualify for other affordable-housing programs tailored to median- and low-income households.
The Hughes Corp. is offering the Ke Kilohana units for sale more than two years after it received an HCDA development permit for the tower in late 2013, and follows the agency’s rejection last year of a contentious proposal the developer made to convert the project to rental apartments.
Todd Apo, vice president of community development for Hughes Corp. in Hawaii, said Ke Kilohana represents an “amazing next step” in building a new community called Ward Village on 60 acres of largely retail and industrial property previously known as Ward Centers.
The Ward Village master plan calls for developing up to 4,300 condo units in 22 towers along with about 1 million square feet of retail space. Three condo towers — Waiea, Anaha and Ae‘o — are already under construction. Average unit prices at these three towers range from $1 million at Ae‘o to $3.6 million at Waiea.
Hughes Corp. in July also began selling units in a fourth planned luxury tower, called Gateway Cylinder, which it said will set a new price record at Ward Village. However, the company has declined to disclose prices or sales, and acknowledged Wednesday that it will take longer to sell the Gateway units than other projects.
“Demand for luxury condominiums in Honolulu, like any market, has limits,” said Howard Hughes CEO David Weinreb in a letter to shareholders.
Apo said interest in Ke Kilohana has been “phenomenal” based on people who attended informational workshops. Kai Brown, the project’s sales manager and a broker with Locations LLC, added that the workshop turnout is expected to equate to extraordinary interest to buy units.
While considered affordable, most Ke Kilohana units are still above last year’s $368,000 median price for previously owned condos on Oahu.
Amenities in the 43-story Ke Kilohana tower include a common area lanai high up in the tower with ocean views, a movie theater, a music studio and karaoke room, a fitness center, indoor and outdoor keiki play areas, work space with meeting areas, and a landscaped deck with barbecue grills and indoor-outdoor lounges for dinner parties and casual events. There also will be a 23,000-square-foot Longs Drugs store on the ground floor, and the city’s planned rail line will be next to the tower with a stop on the other side of Ward Avenue.
Some restrictions attached to Ke Kilohana units include the right for the HCDA to buy back units that initial buyers elect to sell within 2 to 5 years, and a requirement for initial buyers to pay the HCDA the difference between a unit’s original sale price and market price whenever the unit is first resold. Buyers also must meet asset value limits and cannot already own a home.
Hughes Corp. has given a relatively short window for interested buyers to submit applications for Ke Kilohana. Applications can be picked up from the company’s sales gallery in the IBM Building at 1240 Ala Moana Blvd. for nine days, from Saturday to April 3. Those applications must be returned in person between April 8 and 13, the company said.
Prospective qualified buyers don’t have to be present at the lottery, which will be shown via a webcast. The lottery will determine an order in which buyers can opt to buy a unit among those that remain available. Often a backup list of buyers is kept in case buyers back out or sales fall through.
Apo encouraged interested buyers to respond within the short window for picking up and returning applications.
Hughes Corp. is under pressure to sign sales contracts and collect buyer deposits so it can start construction. HCDA has required that construction on the affordable tower begin before anyone can move into the first luxury tower at Ward Village. Completion of Waiea is expected by the end of this year.
