A Malibu, Calif.-based real estate investment company is expanding its retail property holdings in Hawai'i with plans to develop a small two-story retail complex in Waikiki.

American Commercial Equities LLC plans to develop the project at 1944 Kalakaua Ave. on the diamondhead corner of Niu Street near Fort DeRussy. The property is largely a former car rental lot and is adjacent to the recently opened ING Direct savings bank Internet cafe on the site of a former Local Motion store.

American Commercial plans a two-story complex with 14,000 square feet of retail space. Commercial real estate brokerage firm CB Richard Ellis is handling tenant leasing for the project, which is being designed by local architectural firm Eight Inc.

According to property records, American Commercial bought the site with five smaller adjacent parcels in July for $6.5 million from Japan-based Nihonkai Richland.

The California company also owns the former Local Motion property, which it bought in June 2007 for $15 million and leased to ING, and the Aina Haina Shopping Center, an East O'ahu neighborhood retail complex that it bought in June 2007 for about $32 million and plans to overhaul with renovations and some new tenants.