Posted on: Tuesday, November 6, 2001
A&B buys Waikiki land for high-rise
By Frank Cho
Advertiser Staff Writer
A&B Properties Inc., the real estate development and management subsidiary of Alexander & Baldwin Inc., has acquired its first Waikiki property for $3.6 million as part of a plan to develop the area's first fee-simple high-rise development in a decade.
The 1.63-acre property is the company's 13th Hawai'i real estate acquisition since 1999 and one of the last undeveloped fee-simple parcels in Waikiki, the company said.
At the entrance to Waikiki and bordered by Ala Wai, Kalaimoku Street, Kuhio Avenue and 'Olahana Street, the vacant property was purchased from DAI Investments Inc.
"The development of this property will help revitalize an important Honolulu community — Waikiki — which is home to more than 20,000 residents, in addition to being a key visitor destination," W. Allen Doane, A&B's president and chief executive officer, said in a statement.
A&B has been on a three-year buying spree of Hawai'i properties that have grown to $175 million in real estate during the period. The company owns more than 5.4 million square feet of retail, office and industrial space.
"There has been increasing investment in the infrastructure, resort and retail components of Waikiki in recent years, but no new fee-simple condominiums. We see an opportunity to create a superior residential project in an excellent location," said Michael Wright, A&B Properties' vice president for acquisitions.
Wright said 13,500 square feet of the total 71,000 square feet are zoned for commercial uses.
"Our planning for the property is, however, only in the very conceptual stages and we will be spending the next few months designing a project that makes the most sense for the area and for the market," Wright said.
A&B owns more than 91,000 acres of Hawai'i real estate, making it the state's fifth-biggest landowner. It is developing residential projects in the Ko Olina Resort in a joint venture with Armstrong Builders, and a light-industrial subdivision in Central O'ahu. The company is also working on Neighbor Island projects such as a 1,000-acre master-planned community on Kaua'i and a retail center on Maui.
Despite the slowdown in Hawai'i and on the Mainland, Doane said he is confident that Hawai'i's economy has a strong long-term outlook.
The company last month reported that third-quarter net income dropped 19 percent, largely because of a slowdown in its Matson Navigation Co. shipping business, and warned that A&B's financial performance next year is unlikely to measure up to this year's.
But Doane also said A&B remains strong financially with low debt levels and will continue growing through acquisitions.
Reach Frank Cho at 525-8088, or at fcho@honoluluadvertiser.com
