Wal-Mart eyes Kapolei
By Andrew Gomes
Advertiser Staff Writer
As Wal-Mart prepares to open its first store in Honolulu's urban core next month, the retail giant is exploring a move into O'ahu's "second city," Kapolei.
The world's largest retailer is part of one of several competing plans to develop a commercial complex on 25 acres across from Kapolei Shopping Center next to H-1 Freeway.
If Wal-Mart does move into Kapolei, it would greatly add to the retail shopping selection in the burgeoning area, but may also raise concerns about traffic congestion and competition for small retailers.
It would also take Kapolei a step closer to being recognized as a full-fledged city able to satisfy most needs of area residents.
Wal-Mart has not confirmed plans to locate in Kapolei. Wal-Mart spokeswoman Cynthia Lin said the company, which routinely explores expansion possibilities, does not acknowledge plans for new stores until they are certain.
A spokeswoman for landowner and Kapolei master developer Campbell Estate said the private trust is not having discussions with Wal-Mart, but she declined to say whether the estate is negotiating with a developer proposing a project anchored by Wal-Mart.
The spokeswoman, Theresia McMurdo, said it would be inappropriate to identify parties vying to acquire the 25-acre site, but she said no agreement has been signed to sell or lease the property.
People familiar with the Wal-Mart effort said that several retail developers approached Campbell with plans for the site and that one of them is working with Wal-Mart and probably has the best chance to succeed.
More than one person involved in the competition to acquire the site said Wal-Mart and an unidentified private developer are studying the feasibility of their project and could decide not to go forward.
These sources asked to not be identified so as not to jeopardize their chances of being considered to develop the site should Wal-Mart pass up the opportunity.
There also may be restrictions as to where or when Wal-Mart could open a Kapolei store, given competition-related covenants held by Big Kmart, which opened a Kapolei store in November 2000.
When Big Kmart announced plans for its store, Kapolei Shopping Center merchants and community leaders criticized Campbell Estate for its deal with Kmart, arguing that the discounter would hurt small businesses as far away as Wai'anae.
Area residents also have long voiced concerns about more development creating more traffic, though others say more retail outlets will help cut down on the need to leave Kapolei to shop.
"Our shopping areas are always crowded," said Maeda Timson, chairwoman of the neighborhood board for the area. "We would love to have a Pearlridge-kind of shopping center or a Kahala Mall. We really would like a variety of stores."
Besides Big Kmart, Kapolei has another big-box retailer, Home Depot, plus a few dozen small to midsize retailers including Longs Drug, Radio Shack, Payless ShoeSource and Jeans Warehouse primarily at two shopping centers.
Whether plans involving Wal-Mart are realized or fall through, observers said Kapolei is certain to get more stores soon.
"Since Campbell opened up all their properties for sale, (development interest and activity) has just taken off," said Steve Sofos, president of local real estate firm Sofos Realty Corp. "It took 10 years for (Kapolei) to get going. It's nice to see that the market is catching up."
The latest planned additions to Kapolei include Outback Steakhouse, Buono Pasto Assagio, Central Pacific Bank and Island Pacific Academy, a private high school.
Over the years, the estate has come close to landing some big retail projects but come up short.
In 1997, Arlington, Va.-based mall developer Mills Corp. announced it signed a letter of intent with the estate to develop a retail outlet/ entertainment center with more than 200 stores on 100 acres. But the company dropped its option on the property and development plans a year later.
On the 25-acre site being considered by Wal-Mart, local developer Larry Traub of G&S Investors/Hawaii LLC had an option to buy the property a couple of years ago, but his attempt to develop a big-box value center didn't pan out.
Bill Gresham, a local real estate developer involved with establishing AAAAA Rent A Space and The Marketplace At Kapolei, said there has been overwhelming interest from Mainland and local developers who, like him, believe there is a lot of opportunity to significantly expand retailing in the area.
"It doesn't quite have that density," he said. "It's not where it needs to be. Kapolei is growing and it'll continue to grow."
Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.
