Victoria Ward Ltd. sees housing-retail mix

By Andrew Gomes
Advertiser Staff Writer

The chief executive of Victoria Ward Ltd. said yesterday that the company is willing to sell some of its prime Kaka'ako land for developing up to six residential high-rises beside Ward Centres.

Selling portions of the vast estate upon which the Victoria Ward corporation was built represents a shift for the company, but the decision will help fulfill its vision of creating a self-contained urban village on 65 acres in a "new midtown Honolulu."

Mitch D'Olier, Victoria Ward president, shared the company's updated master plan with an assembly of the Hawai'i Developers' Council yesterday, briefing the group on how new residential plans, future retail phases, redevelopment of Ward Warehouse, more parking and street realignment will fit together.

"Our long-term goal very specifically: a two-block Main Street surrounded by a residential community," he said.

D'Olier envisions the neighborhood this way: "Living in a high-rise urban residential home in Kaka'ako with an unobstructed ocean view. Walk to work ... walk to Starbucks, walk to Borders ... walk down the street to go to the movies at night, stop off afterwards for dinner and go back home. Never use your car."

"That's the type of community that we're trying to synergize and use to feed our retail/entertainment/lifestyle destination," he said.

Victoria Ward formed its vision in the early 1990s. Since then it has worked toward it by adding mostly retail, including Ward Village Shops, Nordstrom Rack, Office Depot, Sports Authority, Pier 1 Imports and Ross. Under construction is the 156,000-square-foot Ward Entertainment Centre housing a 16-screen theater, Dave & Buster's and more retail.

Annual retail sales for the company have grown from $65 million in 1993 to more than $155 million at the end of last year, D'Olier said.

The decision to incorporate residential towers by selling trust land is a more recent development.

"We've kind of crossed the Rubicon on our willingness to do these kind of transactions," D'Olier said.

Andres Albano, vice president of development consulting for real estate firm CB Richard Ellis Hawai'i Inc., said of the updated plans: "It's a revelation. I think that's great news that Victoria Ward is willing to sell properties."

Victoria Ward would use proceeds of land sales to reinvest in Hawai'i or Mainland real estate, according to D'Olier.

No timetable for residential development has been set, though developers say the market is attractive now for high-rise condominiums in central Honolulu.

"It's probably the hottest segment of the real estate market right now," Albano said.

Nauru Phosphate Royalties (Honolulu) Development Inc., developer of the $110 million Hawaiki Tower just diamondhead of Victoria Ward's property, plans to build a similar luxury high-rise this fall. Unit prices will average $550,000 to $575,000 fee simple.

The development firm, an arm of an investment trust for the Pacific island nation of Nauru, plans to follow that project with another residential tower around 2006.

Albano said residential high-rise development at the Ward complex could co-exist with Nauru's plans if it targets a different market segment — just below luxury, something similar to One Archer Lane, or even rentals.

"If you have a good mix of residential in the area, that's what you need," Albano said. "You already have all the retail."

Other plans for Ward Centres:

• More retail to be added on either side of Kamake'e Street at the 'ewa end of Ward Centre and the diamondhead end of Ward Warehouse. D'Olier said he is discussing partnership possibilities with Simon DeBartolo Group and other development companies for this second phase of the Ward Entertainment Centre.

• Diagonal parking spaces along Auahi Street that were recently approved by the city.

• Another 1,500 parking spaces not currently in public use to be made available to handle Ward Entertainment Centre traffic.

• Phasing in redevelopment of Ward Warehouse. D'Olier did not disclose a timetable, but said the aging center eventually will be redeveloped, possibly with parking initially, then more retail. All existing tenants at Ward Warehouse will be moved to other Victoria Ward property when redevelopment happens.

• Queen Street realignment construction, expected to start next summer. Connecting Queen to Ala Moana Boulevard and Waimanu Street will improve vehicle access to Ward Centres.

Andrew Gomes can be reached by phone at 525-8065, or by e-mail at agomes@honoluluadvertiser.com