Rich housing risks easing out locals

It was more than a touch ironic that the kamaaina real-estate developers who are building a second opulent condominium complex at Ala Moana Center announced the same week that their retail arm is shutting down all eight Price Busters stores elsewhere on Oahu, throwing nearly 200 people out of work after the holidays. Clearly, the profits are in luxury goods, not discount ones.

That’s not a surprise, of course, in our glittering city at the crossroads of the Pacific. But the juxtaposition did give us pause, and cause to wonder anew: As Waikiki seemingly blends into Kakaako, what’s in it for middle-class people who live on this island — as opposed to wealthy investors buying second or even third homes — not to mention those Oahu residents even farther down the economic ladder?

All the new luxury developments in urban Honolulu bring jobs, of course, in construction and related industries, which are vitally important. A variety of taxed spending related to their construction flows into city and state coffers, too, which funds everything from roads to schools to social services to ag-land conservation.

But do they provide housing for regular local folks? At these prices? Not so much. Those young professionals still bunking with mom, dad and grandma in the ohana houses they grew up in will continue to hunker down: The median household income in Honolulu County is about $72,000, according to the U.S. Census — not even in the ballpark for the luxury residential towers rising in the urban core.

As land use goes, there’s nothing much to quibble with in the shrewd plan to build extravagant condos with private pools and gardens atop the makai parking deck of Hawaii’s largest shopping mall, between Piikoi Street and Neiman Marcus. MacNaughton Group and Kobayashi Group are partnering with investment firm BlackSand Capital and Ala Moana Center’s owner, General Growth Properties, on the project, seeking to repeat the success of the 23-story, luxury ONE Ala Moana tower they’re building atop the Nordstrom parking structure on the mall’s opposite side. Those 206 condos sold out quickly, at prices that reached $10 million for one unit.

The new project would add about 200 sumptuous units in mid-rise buildings along a quarter-mile stretch of Ala Moana Boulevard, with construction coinciding with the Bloomingdale’s coming in as an anchor tenant where Sears used to be. The land is zoned for such use, and the developers aren’t seeking height variances. With nothing between the condos and Ala Moana Beach Park except for the boulevard, ocean views from the penthouse units are assured.

As the mall itself becomes more and more geared to high-end shoppers, this fusion of luxe retail and luxe living makes sense, when thinking mainly of profit margins.

Online shopping is already reshaping the retail landscape, so who knows what the average shopping mall will look like in a few generations. Ala Moana Center could be ahead of the U.S. curve on this, taking a lesson from similar developments in Hong Kong and Singapore.

And yet it feels like Honolulu is crossing a threshold here, even though the units aren’t even the most expensive in town; there’s an upcoming penthouse in Kakaako listing for $50 million. Maybe it’s because Honolulu isn’t Hong Kong or Singapore, and shouldn’t ever be.

The website promoting the Ala Moana condo project highlights the grand ocean vistas from the upper units: one photo depicts a dazzling view of Magic Island and the adjacent beach park, where the grass gleams a bright neon green, nary a homeless person in sight. It’s an unrealistic vision of Hono-lulu in this day and age.

Perhaps our view is equally unrealistic. But we won’t give up calling on real-estate developers to build more attainable, quality homes for regular working people. The profit margins might be slimmer, but the positive impact on the community is priceless.