Developer proposes hotel at Aloha Tower
A Dallas-based developer has proposed a $64 million, 250-suite hotel at the Aloha Tower waterfront as part of a $131 million redevelopment that would include a refurbished cruise ship terminal and 714-space parking deck.
The proposed hotel, designed for business travelers, represents a second phase of UC Urban's proposed redevelopment of the state-owned property near downtown Honolulu. The first phase, located on Piers 5 and 6, includes 375 residential condominiums, 50,000 square feet of retail space on two levels, an intra-island ferry terminal, promenade and seawall extensions and parking.
Kenneth Hughes, president of UC Urban, has presented plans for the second phase, on Piers 10 and 11, to the state's Aloha Tower Development Corp., which manages the property.
The proposed project, which still must be approved by the state agency's board, also would include state Department of Transportation offices and parking, retail space and a place for a bus terminal.
UC Urban is in talks with hotel developer Western International to develop the hotel, Hughes said.
Hughes, who has been working with the state since 2002 creating plans for the ambitious redevelopment, said the feasibility of a hotel has become apparent as rooms in Waikiki have began filling up in the past few years.
Hughes said there was an obvious need for accommodations for business travelers seeking to avoid the tourist crush in Waikiki. The redeveloped complex also will help make a good first impression of Oahu for cruise passengers, he said.
"The ... new appropriate development down there will be for many people their first impression on arrival in the islands," Hughes said.
Under a deal with the state, UC Urban has agreed to provide 100 percent of the construction financing, although taxpayers would be expected to foot the bill for infrastructure improvements.
Envisioned improvements, which could cost approximately $130 million, include changes to Aloha Tower Drive and Nimitz Highway, construction of a 2.4-mile trolley system linking the area with downtown Honolulu, and the demolition of a Hawaiian Electric Co. power plant and creation of three new park areas in its place.
Hughes said UC Urban has located sources of financing for the Piers 10 and 11 project but is awaiting approval by the Aloha Tower Development Corp. board before the company seeks to close a financing deal. According to UC Urban's development schedule, completion of commitment letters for construction financing would be secured next spring.
Another step, Hughes said, will be to create a construction schedule that would cause few disruptions to facilities not under construction. A proposed schedule calls for demolition at Pier 10 to begin in July with the new cruise terminal and DOT offices to be finished in October 2007. Demolition of existing facilities at Pier 11 would not begin until November 2007.
The projects at Piers 5 and 6 are moving forward considerably more quickly. Hughes said that financing for that phase is "all but done," and that construction should begin by summer next year.