Resurgence enlivens Waikiki
| • | Police sweeping vendors off streets in Waikiki |
By John Duchemin
Advertiser Staff Writer
| • | See a map of Waikiki improvement highlights |
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Duty Free Stores has opened the Galleria, a $65 million themed shopping complex. The $95 million Kalia Tower project at Hilton Hawaiian Village is scheduled for completion in May; construction has begun on the $140 million Honu Group retail project. Spurred by these signs of development, many hotels are undergoing renovation.
These are only the most visible transformations in Waikiki. A shift in attitude — from despondence to confidence — has filled the district with hope and liveliness after a moribund decade, observers say. Last year's record visitor arrivals, land value revivals and economic gains have restored some investor confidence in Waikiki. And major players have become less fixated on past failures and more eager to invest in the future than at any time since the 1970s, said Rick Egged, president of the Waikiki Improvement Association, a non-profit organization representing area business interests.
"We're at the very beginning of a new Waikiki," Egged said. "Right now, really, is the best Waikiki has ever been, in terms of direction: We have the tools for redevelopment, and the interest of landowners and investors."
Structural flaws
But while business and community leaders consider most of the recent changes to be constructive, Waikiki still has many structural flaws that will take millions of dollars to fix — and are also crucial to Waikiki's further development.
Despite the spike of renovation activity, many properties — as many as one-third of the hotels, Outrigger Properties Chief Operating Officer Melvin Kaneshige estimated — are obsolete, decaying and generally unfit for modern tourism, some business leaders say. Several contend that special Waikiki zoning rules make renovations difficult; others say that the economic climate, until recently, has been too poor to stimulate major reconstruction activity.
The vision — a popular canal-side promenade — hinges on dredging and continued landscape improvements.
City plans to dredge the Ala Wai have widespread support, but a contractor who lost the project bid is disputing the selection.
Other problems revolve around Kuhio Avenue, which city leaders are targeting for redevelopment and which businesses and residents consider uninviting; the uncertain fate of important physical features including the Natatorium pool and the Ala Wai Golf Course; and the beaches, which are eroding and may need a multimillion-dollar facelift.
Interested parties are attacking each of these problems and the stakes are high: the momentum of current development could lift Hawai'i's star attraction, which accounts for more than half of the state's tourism revenues, out of a multi-decade funk — if it's done right, said Ronald Gilligan, a longtime Hawai'i real estate broker.
"It would appear that what's being done with Waikiki, particularly in the common areas, has been constructive and positive," Gilligan said. "But we want it to be a special place, a Hawai'i place, and we have to make sure that's what happens."
Opposition to plans
Success will hinge on the teamwork of many interested parties: business owners, who are spending hundreds of millions of dollars on new developments; the city, which is putting up tens of millions of dollars for improvement projects; the state, which is proposing several millions' worth of changes; and community groups, who are demanding an active role in the planning.
But whether these groups can come together remains to be seen. While all agree on an important concept — that Waikiki needs to improve both its physical appearance and its "feel" — they don't always agree how to proceed. Many of the development plans are thus complicated by conflicts.
The city's proposal to put bus lanes down major Waikiki thoroughfares has drawn opposition from taxi and tour-bus drivers who fear increased congestion. City and business leaders support a $3.5 million state budget proposal to add sand to the beaches, but the proposal does not make it onto the House of Representatives version of the budget.
The state wants to turn the Ala Wai Golf Course into a public park, but golfers object. The city wants an alternate golf course constructed before the state proceeds. A community group, the Kaimana Beach Coalition, opposes the city's plan to turn the Natatorium's salt-water pool into a public swimming facility, citing potential health concerns and fears that nearby Kaimana Beach would suffer from overcrowding.
Side streets off Kalakaua and Kuhio avenues are targeted for wider sidewalks, improved landscaping.
The city's recent launching of nightly torch-lighting and hula ceremonies are intended to preserve and restore island culture
City plans to dredge the Ala Wai Canal have widespread support, but a contractor who lost the project bid is disputing the selection of a rival. Major property owners seek changes to the Waikiki Special Design District, aiming to make property development and renovation less onerous. But Peter Apo, the head of the city's Office of Waikiki Development, disagreed, saying creative developers can make projects work within the existing regulatory framework.
Measure of success
The only true measure of success, many observers say, is if Waikiki can truly enhance its ambience — a central concern of most stakeholders.
Residents want Waikiki to be more livable, with increased open space, improved aesthetics and less noise, pollution and other disruptions. Hoteliers and retailers envision a more active Waikiki, with frequent events and unique attractions to draw more locals and sustain visitor interest. Several groups continue to call for more highlighting of Hawai'i elements.
All these stakeholders call for an improved "sense of place," a return to the magic and uniqueness of Waikiki — a desire that has been evident since the first high-rise boom several decades ago.
"Everything is really about taking better care of our beautiful spots, and preserving the culture and ecology," said Peter Schall, managing director of Hilton Hawaiian Village. "If we can do that right, the local people will enjoy it just as much as the visitors."
This desire has taken many shapes through the years: The move in the 1970s to create the special design district, which put rigorous restrictions on new construction; the efforts of the late George Kanahele and other Hawaiian leaders to preserve and restore island culture in Waikiki; the city's recent launching of nightly torch-lighting and hula ceremonies, and the designing of a "trail" of historic sites.
"The essence of Waikiki has to include not just the cultures of Hawai'i, but the original culture of the people," said Republican state Rep. Galen Fox, one of only two elected state official who lives in Waikiki. "That's why people come to Hawai'i. And many residents in Waikiki live there because they love that old romance. But we want to see more of that."
Only recently, however, have these desires become the goals of most developers, the city's Apo said.
Photos by Cory Lum • The Honolulu Advertiser
"In the last several years, the captains of the industry have finally 'gotten it,' " said Apo, director of the Office of Waikiki Development since December 1999. "That's when they really began to make a difference, and created the phenomenon we're experiencing now."
A revamped beach walk helps, but leaders call for new sand to spruce up eroded shorelines.
The business improvement district has hired street-cleaning, landscaping and security crews to make Waikiki more attractive.
Before that, Waikiki was frozen in a particularly unattractive phase, observers said. While it still pulled in millions of visitors each year, the buildings were decaying and new investment slowed to a trickle, Gilligan said.
The Japanese real estate bubble and crash of the early 1990s, the Asian economic crisis and Hawai'i's own economic struggles all contributed to Waikiki's malaise. But many business leaders credit the Waikiki Special Design District with strangling Waikiki redevelopment.
First established in the mid-1970s after a prolonged boom of skyscraper hotel and condominium construction, the group imposed strict height, density, open-space and architectural guidelines on new buildings, and required older buildings to comply with the new rules after renovation. As a result, many of the older buildings suddenly faced the prospect of hefty renovation costs — and many owners thus chose not to redevelop their properties, Outrigger's Kaneshige said.
A package of reforms, including a seven-year tax incentive, passed in the mid-1990s and relieved some of the burdens — but more needs to be done, Egged said.
"Right now, every major project needs a variance, and that isn't a workable situation," Egged said. The Waikiki Improvement Association plans to lobby hard this year for new special district changes, he said.
The city's Apo, however, said businesses need to give the latest round of reforms a chance. He points out the major new developments — the Kalia Tower, Honu Group and DFS projects — as evidence that investment is possible.
Continued development
The city's goal, Apo said, is to ensure Waikiki development continues past the recent actions — and doesn't stagnate again, as happened after the collapse of the Japanese real estate boom. The city plans to focus on Kuhio Avenue reforms, generally designed to improve the pedestrian experience by widening sidewalks, encouraging streetfront cafes, improving landscaping and creating more green space. The plan shares the goals of the business improvement district, which has hired street-cleaning, landscaping and security crews to make Waikiki's urban core more attractive.
The state, meanwhile, is tackling several issues on the periphery of Waikiki. While Gov. Ben Cayetano's proposal to turn Ala Wai Golf Course into an "urban park" has attracted attention and controversy, another plan to rejuvenate the beaches may ultimately be more crucial, Waikiki leaders said.
"The whole beach could stand to be enhanced," Hilton's Schall said. "Any asset that's that important needs to be nourished."
Schall's hotel complex, one of Waikiki's most influential business interests, has spearheaded many of the recent changes. Besides Kalia Tower, which will open in May, Hilton has also agreed to help landscape the Ala Moana Boulevard street front along the Fort De Russy Park, which must be dug up anyway thanks to a Kalia Tower sewer main.
Hopefully, such efforts will only inspire Hilton's neighbors to do renovations of their own, Schall said.
"As Waikiki goes, we go," he said.
Correction: Rep. Galen Fox is not the only elected state official who lives in Waikiki. Rep. Mindy Jaffe also is a resident. A previous version of this story was incorrect.
