It's a tale of 2 ridges — and 17,500 homes
By Gordon Y.K. Pang
Advertiser Staff Writer
By Gordon Y.K. Pang
Two neighboring, large-scale and long-watched housing projects in Central O'ahu appear headed in opposite directions.
Officials at Waiawa Ridge Development LLC say they will break ground this year on the first of nearly $400 million in roads, utility lines and other infrastructure improvements in advance of its 5,000-unit first phase.
On the next hill, Castle & Cooke Homes Hawaii this month received formal notice that its application before the Land Use Commission allowing up to 7,500 units has been dismissed, signaling that the developer is reassessing its plans.
Central O'ahu residents, business and labor interests, and environmentalists are all watching the developments, which combined, could ultimately bring as many as 17,500 new homes into a region almost equidistant from Honolulu, Kapolei and Wahiawa, making it truly the center of the island.
Developers of both projects say they intend to overcome the myriad issues they've faced to provide an attractive home-buying alternative to the density of Honolulu and the growing urban center on the 'Ewa-Kapolei plain.
But they'll also have to contend with what seems to be a slowing housing market, continuing concerns about traffic and environmental impacts they may cause, and competition from developments in West O'ahu.
Call it "The Tale of Two Ridges."
The parent company to Gentry Investment Properties Inc. first received approvals for the 3,700 acres of Kamehameha Schools land in the 1980s. At full build-out, Waiawa Ridge could have as many as 10,000 homes.
Panakauahi Gulch, which stands between the H-2 Freeway and Waiawa Ridge, has long been deemed an impediment to developing the site. No more.
Waiawa Ridge Development, a joint venture formed last year between homebuilder Gentry Investment Properties and Alexander and Baldwin Inc., intends to spend approximately $25 million to build an extension of Ka Uka Boulevard with a large culvert over the gulch, said Alan Arakawa, Waiawa Ridge president and chief executive officer. "It's a major improvement that needs to be done to provide access into the property," he said.
Meanwhile, another $40 million is being spent to upgrade the Waipi'o Interchange of H-2 Freeway, Arakawa said. The plan includes improving the off-ramps, building a new loop on-ramp, and eventually widening Ka Uka.
Another major infrastructure project involves building a $30 million sewer trunk line that will stretch down to the Pearl City pump station.
All three projects are in planning and design stages and expected to begin construction by the end of the year.
Waiawa Ridge Development intends to be the master developer only, putting in the infrastructure improvements and selling off parcels to homebuilding companies. That does not preclude one of Gentry's or A&B's other arms, however, from ending up in the housing mix. A broad spectrum of homes is expected. Entitlements require 30 percent of the homes to be marketed to families earning 80 percent to 140 percent of O'ahu's median income, but mid-range and higher-end homes will also be available, Arakawa said.
The first homes are expected to be occupied in 2010.
This project has been fraught with roadblocks since Castle & Cooke, developers of Mililani and Mililani Mauka, first rolled it out in 2000.
In an unusual but not unexpected move, the Land Use Commission last month dismissed the Koa Ridge petition by Castle & Cooke and its partner, Pacific Health Community. The decision was based primarily on the lack of action on the part of the developers, said LUC executive director Anthony Ching.
The commission, in 2002, actually gave approval to two of the three segments of Koa Ridge, allowing for development on 763 acres with up to 3,200 homes. But the Sierra Club Hawai'i Chapter sued the commission, contending the developer should have filed an environmental assessment with the LUC.
Castle & Cooke argued that filing an environmental assessment at the LUC level had never been required and would set a precedent.
A Circuit Court judge sided with the Sierra Club in 2003 stating that because the project included the use of state lands, an environmental assessment should have been filed. That decision was upheld by the Hawai'i Supreme Court in 2006. Meanwhile, Castle & Cooke has been in litigation with its partner, Pacific Health Community, which had been picked to develop a healthcare component near Waipi'o Industrial Park.
Castle & Cooke, according to its Web site, terminated its agreement with Pacific Health in 2004 after it "encountered difficulties with its development." The dispute is in mediation.
Carleton Ching, Castle & Cooke vice president of community and government relations, said his company did not object to the LUC's action. He noted that it can file a new petition immediately. The company still wants to develop at Koa Ridge a range of housing, employment and medical opportunities, he said.
At this point, "we have to go back and relook ... both projects again," he said. A new petition to the LUC may or may not include all of the original plan but the intent is "to come back real soon," he said.
The Mililani/Waipi'o/Melemanu Neighborhood Board has also raised concerns about the Koa Ridge project.
Dick Poirier, longtime board chairman, said he has no doubt that Castle & Cooke will return to the LUC soon. The lawsuit against the project "basically delayed the project but it hasn't stopped it," he said.
The board's biggest issue is traffic. The Ka Uka Boulevard interchange, heavily used by motorists visiting the Waipi'o Costco and other area businesses, could end up being the major entry for both Koa Ridge and Waiawa Ridge.
Poirier said many of the issues the board raised with Koa Ridge also exist at Waiawa. He suggested that the developers move the main entrance south in order to connect with the city's proposed mass transit project. "Maybe we don't need a train (to Mililani) but we need access to the Pearl Highlands transit station," he said.
Arakawa said that an entrance for the Pearl City side of the project is planned, possibly connecting with Kamehameha Highway near Waipahu Street, but likely won't be put up until Waiawa's second phase is developed.
Jeff Mikulina, Sierra Club Hawai'i chapter director, said a key reason his organization opposed Koa Ridge is that it is slated to go on some of the best agricultural land in the state.
The group also believes there is enough planned housing elsewhere without the need to redesignate large tracts of undeveloped land.
While the club has not looked closely at Waiawa, it has similar concerns there, Mikulina said.
"What these projects share in common is just more of the classic sprawl, more bumping up against the carrying capacity limits we have on this island — limited water, limited energy, limited waste capacity and all that," Mikulina said.
Both the city and the state agreed years ago to direct growth toward the 'Ewa Plains, and tens of thousands of homes have yet to be built there, he said. "Where's this planning; is this just a free-for-all where ... people can develop in Central, we're going to develop in 'Ewa, we're going to develop wherever people have land?"
Waiawa's developers, despite having all the critical approvals to proceed, should step back and reassess a decades-old plan to put up large tracts of housing, Mikulina said. "Conditions have changed."
Despite the concerns and a slowing housing market, there are those who feel there is a need for both projects.
Kyle Chock, executive director of the Pacific Resources Partnership, an alliance of construction labor and contractor groups, said potential home buyers for Waiawa and Koa Ridge are looking for something closer to downtown Honolulu while those living along the 'Ewa and Kapolei subdivisions are more likely to be eyeing the jobs centered there.
"Developers are building for different segments of the marketplace based on the wants and needs of the consumer," Chock said. "Waiawa and Koa Ridge are very attractive developments given their close proximity to the H-1/H-2 merge, making commutes to downtown a lot easier."
Bank of Hawaii chief economist Paul Brewbaker said there continues to be a need for housing on the island. He believes that had both projects been developed sooner, the increased housing inventory would have slowed down the sharp increase in home prices and possibly extended the boom in home sales.
Brewbaker noted, however, that both Castle & Cooke and Gentry have historically been long-term housing players, developing projects designed to be built out over several decades.
"They were a missing part of the most recent cycle, but there'll be another cycle," he said.
Reach Gordon Y.K. Pang at email@example.com.