Project gets loan by pension fund

By Andrew Gomes
Advertiser Staff Writer

The state Employees' Retirement System has decided to lend $25 million to the developers of the $210 million Hokua luxury high-rise in Kaka'ako.

The pension fund is one of several lenders that were being sought by Bank of Hawaii and First Hawaiian Bank, which are participating in and arranging a $130 million construction loan for the project at the corner of Queen Street and Ala Moana at the diamondhead end of Victoria Ward Centres.

Jeff Arce, chief financial officer for The MacNaughton Group, a local firm developing Hokua with The Kobayashi Group, said he expects the rest of the loan to be syndicated in the next couple of months in time to begin construction by the end of the year.

The developers also obtained a commitment earlier from another local company, Alexander & Baldwin Inc., to invest $40 million in return for partial ownership of the planned 40-story tower. Deposits to buy units and developer equity will make up the balance of the project's cost.

To date, purchasers have signed sales contracts for 233 of the 247 units at prices between $535,000 and $5.5 million. The project is expected to be completed in late 2005.