ILLUSTRATION COURTESY OF UC URBAN|
This drawing shows the concept for a "Pacific Quay" near Aloha Tower Marketplace, presented yesterday before the board of the state Aloha Tower Development Corp. The project would include 550 loft-style apartments and 50,000 square feet of restaurants.
A development plan requires
$130 million in improvements
A Texas developer told the Aloha Tower Development Corp. yesterday that it will take $130 million in infrastructure improvements and demolition to make his Honolulu waterfront mixed-use residential and commercial design concept feasible.
Ken Hughes, of Dallas-based UC Urban, who was selected by the state waterfront agency to redevelop Piers 5 and 6 near Aloha Tower Marketplace, also told members at a board meeting that he and his financial backers would like to reach a development agrement by July.
"I'm a developer and we like to let the dirt fly," Hughes said. "But we're not going to sign a development agreement if there is still uncertainty about whether solutions can get adopted."
Hughes said he has been approached by a real estate development financial organization, Freemont Realty Capital, which wants to help and could make his plans move ahead faster than he thought. He noted that many of the steps in his project will take years.
"It's important not to sit around from our standpoint," he said. "With a $250 million project, even one tick on the interest rate could hurt."
The ATDC board did not take action on Hughes' plan, but will reconvene in a month to discuss whether his requests can be met.
It would take a variety of financing tools for the state waterfront agency to help fund the changes Hughes envisions necessary for the success of the project, said Ted Liu, director of the state Department of Business, Economic Development & Tourism.
A preliminary breakdown of infrastructure and demolition costs include: $9.7 million to improve Nimitz Highway, $19.2 million to build parking structures, $54.3 million to build the rail system, $29.8 million to tear down the nearby Hawaiian Electric Co. generating plant and another $22 million to construct a park. It's still not clear who would pay for the requested improvements.
Funding the plan would likely require state legislative changes that would give officials additional taxing powers, as well as pursuing federal money, said Malcolm Tom, deputy managing director for the city.
"The city has very limited taxing powers," Tom said. "And, it could take up to five years to obtain federal funds."
Liu said he is talking to the Legislature about approving mechanisms that would give the ATDC latitude to fund the project, but the process will take time.
The marketplace, built in 1994 at a cost of $100 million, was supposed to be the first phase of a $700 million, five-phase project. But developer Aloha Tower Associates ran out of money and defaulted on lease rent payments to the state, which three years ago reclaimed development rights.
During the ATDC board meeting yesterday, Hughes presented members with a refined and enlarged plan for a "Pacific Quay" that mixes a downtown rail system, automobile access, parking and, most of all, easy physical and visual access to the waterfront.
The proposed development, which expands beyond the piers in Hughes' contract, would include 550 loft-style apartments targeted to the young, urban professional. The perimeter on the waterfront would also contain 50,000 square feet of restaurants along the landing and include an interisland ferry stop and streetcar station.
"The seed of urbanism is here," Hughes said. "It's a really nice downtown; it just needs people living in it."
Hughes said the project, which he anticipates starting about two years from now, could eventually generate 3,287 jobs and the rail system alone could bring $571 million in economic impact for the state.
However, developing the Aloha Tower area is not feasible unless city and state officials commit to specific changes, Hughes said. Nearby buildings should be kept as low-rise as possible so that Honolulu's waterfront is not obscured, he said.
The Aloha Tower Marketplace has always needed better vehicle access, and pedestrian access must be easier too, he said.
Hughes, who developed a transit-connected, multiuse complex called Mockingbird Station in Dallas and other similar projects, said the waterfront should not be isolated from the downtown business center, as it now is.
He also wants a trolley system running on curbside rails, like the one that opened recently in Portland, Ore., connecting with any broader mass transit system the city and state eventually create.
The plan includes park space for downtown workers and visitors, and two parking lots, he said.
There would be a broad pedestrian walkway through the middle of the complex and several rail-trolley stations so people could easily cross Nimitz Highway, he said.