Hilton Hawaiian Village plans to expand its footprint onto more of Ala Moana Boulevard with a new tower, adding 515 hotel rooms to what already is Waikiki’s largest resort property.
The resort’s owner recently initiated a regulatory process to amend a master plan to accommodate the proposed 36-story tower on a half-acre of land currently occupied by a rental car business, two-story retail buildings and a shuttered Kobe Japanese Steakhouse restaurant.
If approved, the addition tentatively called AMB Tower would expand the number of hotel and timeshare units by 13% — to 4,463 from 3,948 — on the Hilton property where eight towers exist today.
Park Hotels and Resorts, a Virginia-based real estate investment trust that owns Hilton Hawaiian Village, also said the project will improve part of the Ewa gateway to Oahu’s biggest urban tourist destination.
“The AMB Tower will replace aging retail and restaurant spaces, and will enhance the image of Waikiki as a premier, global tourism destination,” the company said in a supplemental environmental impact statement preparation notice recently submitted to the city Department of Planning and Permitting. “The new tower will present a timeless, contemporary structure with a simple modern design and layout.”
AMB Tower is proposed to rise 350 feet, which matches the height limit for the site, and feature a main porte cochere entryway off Ala Moana, an open lobby, ground-floor retail, restaurants, a bar, pool, fitness center, parking garage and walkways linked to other parts of the existing 22-acre resort campus.
Park Hotels aims to start building the tower as early as late 2024 or 2025, and construction would take 2-1/2 years to complete.
Expanding Hilton Hawaiian Village by a half-acre represents a relatively small but significant addition to the beachfront resort, which was established in 1955 by industrialist Henry Kaiser and has grown to host over 2 million guests annually in recent years.
According to property records, an affiliate of Park Hotels bought the biggest of three lots making up the expansion site, one with the retail buildings, in 2018 for $5.2 million.
The car-rental lot and former Kobe restaurant building are owned by an affiliate of local convenience store chain ABC Stores, which has a store on the parcel owned by Park Hotels and would open a bigger ABC store on the ground floor of the planned new tower, according to the plan.
Joseph Toy, principal of local tourism industry consulting firm Hospitality Advisors LLC, said Park Hotels is looking to satisfy projected need for more hotel rooms in Waikiki and is making use of a site that has long been eyed for expansion of Hilton Hawaiian Village.
Toy said roughly 5,000 hotel rooms were converted to resort condo or timeshare use in the early 2000s, which created room for new hotel projects.
“We have a shortage of traditional hotel rooms,” he said. “We had a pretty big compression of hotel units.”
Hilton Hawaiian Village has been part of the timeshare trend, building the Grand Waikikian timeshare tower that opened in 2008 and converting its Lagoon Tower and part of Kalia Tower to such use since 2000.
In 2010, the resort also produced a master plan focused on adding two new timeshare towers. The first of those towers, the Grand Islander with 418 units, was completed in 2017 for $420 million at the corner of the resort’s main Paoa Place entryway and Kalia Road on a site that had been used as a bus depot.
A second timeshare tower with 250 units was projected for construction around 2022 or 2023 replacing a collection of retail and restaurants known as the Rainbow Bazaar, with timing influenced by Grand Islander timeshare sales.
This master plan now is being proposed for an amendment to allow development of AMB Tower.
As an early step in the permitting process, Park Hotels is producing the supplemental environmental report. The company also will need a special management area use permit and a planned development modification from the Honolulu City Council, as well as a Waikiki Special District permit from DPP.
Public input will be considered at each of these regulatory steps.
Park Hotels noted in its notice that it will seek to increase the maximum overall density of development at Hilton Hawaiian Village by 8% because land-use law permits a higher density given the proposed added land area. The company also said its enlarged resort campus will continue to meet a minimum 50% open space requirement.
The expansion, according to Park Hotels, would position Hilton Hawaiian Village to serve part of an expected long-term rebound in tourism arrivals following the ongoing downturn triggered by COVID-19 last year.
Waikiki’s hotel industry has suffered the most compared with neighbor islands because of a continued dearth of international visitors coming to Hawaii due to travel restrictions.
Hotels in Waikiki, and Oahu overall, had average occupancy of 52% in September, according to the most recent survey by STR Inc. That compares with 56% on Hawaii island, 59% for Maui County and 66% for Kauai.
Typically, Waikiki outperforms these other markets, and it posted 86% occupancy in September 2019.
Park Hotels did not disclose occupancy at Hilton Hawaiian Village, but said in its notice that the metric has slowly increased since the property reopened in December after an eight-month closure during early impacts related to the coronavirus pandemic.
“We are pleased to begin the process to evaluate our plans for a new hotel tower at Hilton Hawaiian Village, which has been welcoming guests and employing local residents for more than 65 years,” Jonathan Fuisz, senior vice president of investments at Park Hotels, said in a statement. “This project will add needed capacity within the visitor area of Waikiki, and will also enhance Park’s commitment to Oahu by creating quality jobs for local families during construction and after the new hotel tower opens its doors.”
HILTON HAWAIIAN VILLAGE EXPANSION
Existing:
>> 22 acres
>> 8 towers
>> 3,948 hotel and timeshare units
Planned addition:
>> 0.5 acre
>> 1 tower
>> 515 hotel rooms
