A 17-story residential building designed for seniors will soon begin to rise in the Pawaa area near the Hawai‘i Convention Center.
The $75 million project called Kalakaua Gardens is one of three senior-living projects in the development pipeline in the same vicinity just outside Waikiki, and the second under construction.
Site work that includes erecting a construction crane began recently on the Kalakaua Gardens site at 1723 Kalakaua Ave., and a ceremonial groundbreaking event is scheduled for Tuesday.
Kalakaua Gardens is a rental project that was previously envisioned as a midpriced condominium by San Mateo, Calif.-based developer Island Paradise Investments LP in 2008. But factors during the economic recession created some hesitancy and led to the repositioning as a senior rental tower with a similar architectural design.
"We waited a long time for this moment," said Louis Leong, vice president of Island Paradise. "It is very exciting for us."
Leong said pre-sales for the condo units between $292,500 and the low $500,000s in March 2008 got a good response. But when the economy began to falter, some doubt emerged as to whether significant sales would fall through by the time construction was finished and buyers needed to complete their purchases.
"I think we made a very wise decision," he said. "The economy wasn’t well for quite a long time."
The revised plan received a unanimous endorsement from the Ala Moana/Kakaako Neighborhood Board in March 2010, and the developer anticipated moving ahead with construction in late 2010. However, another delay occurred when the company decided to add skilled-nursing services that required significant design changes and licensing, Leong said.
The senior-living tower is designed with 168 units, including 136 studios for assisted living. There are also some double-occupancy units to provide 23 beds for memory care and 49 beds for skilled nursing.
Monthly rental rates are not yet set, but are estimated to be around the mid-$5,000 level and up for assisted living. Salt Lake City-based Avalon Health Care Group has been retained to manage the property, and Leong said Palolo Chinese Home provided valuable design and financial analysis help.
Prospective tenant applications won’t be solicited until about seven or eight months before the tower is finished. Construction is expected to be done in late 2015.
The developer projects that the rental building will employ 160 people when complete, including about 20 in management, 80 connected with health care and 60 in dining, housekeeping and other support staff.
If development proceeds as planned, Kalakaua Gardens will become part of a neighborhood attracting a growing concentration of senior-living projects.
Local developer MW Group is well into building a 153-bed, assisted-living rental midrise about a block away at 1812 Kalakaua Ave. next to the former Hard Rock Cafe.
A third project is envisioned with up to 250 residential units proposed by PRW Hawaii LLC closer to Kalakaua Gardens at 1700 Kalakaua Ave.
PRW’s project, which could be 25 stories or so, is in an early conceptual phase that involves discussions with the city over rezoning, height limit and affordable-housing requirement issues. PRW also has agreements or near agreements to buy land for its project from multiple owners.
