The financial burden of maintaining or renovating a 61-year-old facility has prompted the YMCA of Honolulu to sell off most of its Central Y property near Waikiki to raise cash to build a new, smaller facility.
The nonprofit organization said Friday it will sell 1.5 acres under its branch on Atkinson Drive across from Ala Moana Center to a San Francisco developer who plans to build a 120-unit residential condominium on the site.
The Y will use sale proceeds to finance a new facility on land it is retaining, about a third of an acre.
A purchase price wasn’t disclosed. For property tax purposes, the city values the property at $8 million, including $4.9 million for the land and $3.1 million for the building.
The Y is one of the largest nonprofits in Hawaii, annually serving more than 100,000 people with a variety of programs at eight branches plus Camp H.R. Erdman on the North Shore. Its annual operating budget is $25.6 million. But keeping one of its biggest and busiest facilities in good shape has become difficult.
"In the long term, we could no longer support the day-to-day maintenance and overhead costs of the building, and we could not afford to undergo the renovations needed to sustain the facility," Michael Broderick, the organization’s president and CEO, said in a statement. "At the same time, we wanted to remain in Honolulu’s urban core, where the need is great. By raising funds through this land sale, we will be able to build a brand new facility that will better meet the needs of our surrounding community."
The Y isn’t disclosing development cost estimates for the project, which will be built by condo developer MB Property Acquisitions LLC, led by Michael J. Blumenthal.
Under the redevelopment plan, the Y’s existing four-story, 56,564-square-foot building will be replaced with a three-story, 30,000-square-foot building containing most, but not all, present services.
A fitness center, swimming pool and a variety of services and youth programs will continue at the new facility. Family locker rooms and a youth center will be new additions. But 115 residential rooms at the existing Y won’t be replaced.
The Central Y’s partially furnished single and double rooms rent for as little as $45 a day and as much as $1,200 a month for men, women and couples. The rooms, which include use of member facilities and free local phone calls, were an affordable short- or long-term living option for residents and tourists.
For most of its history in Hawaii, the Y has been known for offering inexpensive accommodations as part of its community service mission. But that focus has shifted more recently, and virtually all new Y facilities built in the country over the past 25 years don’t include residences.
"In order for the Y to continue building healthier communities, we need to remain in-tune to the needs of our surrounding neighborhoods, and sometimes that means changing our offerings, including the brick and mortar of our operations," Broderick said in the statement.
On Oahu, two other Y branches include housing. The Nuuanu branch includes 70 single rooms for men only, and the Atherton branch in Manoa includes 79 co-ed dorms for college students.
The Central Y was built in 1951.
The building is expected to be demolished in roughly 20 months, after the developer completes the purchase and other work including design and permitting.
Residents and members will be able to use the Y as usual until it closes.
New Y facilities are expected to be completed by early 2016 after about 18 months of construction.
During construction, Y members will have access to other branches, which are in Kahala, Kailua, Kalihi, Manoa, Nuuanu, Mililani and Waipahu.
About 20 full-time and 60 part-time employees also will be affected. Some will be relocated to other Y branches, while others may be eligible for severance compensation.
A similar development timetable is anticipated for the condo.
Developer MB Property Acquisitions said it has developed property in California and Washington, and was a partner in the venture that developed the 212-unit Watermark Waikiki condo tower in 2008.
Several Hawaii firms have been retained for the Y and condo project, including Architects Hawaii Ltd., Hawaiian Dredging Construction Co., PlanPacific Inc. and Prudential Locations.
