The developer of Ward Village is maintaining sales momentum on three condominium tower construction projects in Kakaako, according to a financial report released Monday.
Howard Hughes Corp. reported selling 51 additional condo units at the projects called Waiea, Anaha and Ae‘o during a roughly three-month period between Oct. 20 and Feb. 1.
The company noted the sales as part of announcing financial results for the fourth quarter.
Texas-based Hughes Corp. said it produced a $25.9 million profit in the October-December period, down 19 percent from $31.9 million in the same time the year before.
For all of 2015, Hughes Corp. earned $126.7 million in net income compared with a $23.5 million net loss in 2014.
Much of the activity affecting Hughes Corp. finances was from mainland real estate projects that include master-planned communities such as Summerlin in Las Vegas and The Woodlands in Houston, as well as retail development projects such as South Street Seaport in Manhattan, N.Y., and The Outlet Collection at Riverwalk in New Orleans.
A major piece also is Ward Village.
Hughes Corp. said Waiea and Anaha sales were a significant contributor to both fourth-quarter and full-year income, but did not quantify the contribution in dollars.
At Waiea, where unit prices average about $3.6 million, the company said it has sold 158 units, or 91 percent of the 174-unit tower, through Feb. 1. That represents three more sales since Oct. 20 when Hughes Corp. last disclosed figures.
Construction on Waiea began in mid-2014 and is half done. Completion is expected by the end of this year.
At Anaha, where the average unit price is about $1.2 million, 270 units have been sold through Feb. 1, representing 88 percent of the 317-unit tower and an addition of eight sales since Oct. 20.
Construction on Anaha began in late 2014 and is a quarter complete. Work is projected to be finished by mid-2017.
The biggest gain in sales was for Ae‘o where the average unit price is $1 million. Hughes Corp. said 207 units in this tower have been sold through Feb. 1, representing 44 percent of 466 units and 40 more sales since Oct. 20.
Construction on Ae‘o is in a preliminary stage.
Between the three towers, the 51 sales are worth a roughly estimated $60 million, though Hughes Corp. has only collected a fraction of that via deposits.
Hughes Corp. collects deposits from condo buyers equal to at least 20 percent of the purchase price, and uses deposits to help fund construction. Some of the deposit money also is recognized as income once a certain amount of construction is complete.
To date, Hughes Corp. has recognized income from Waiea and Anaha deposits but not from Ae‘o. The company reported using $178 million in deposits from the first two towers to finance construction. Another $48 million in deposits has been received primarily from Ae‘o but has not been used or recognized as income, the company said.
There are two other towers permitted for development at Ward Village, a moderate-priced 424-unit project called Ke Kilohana at 988 Halekauwila St. and an ultraluxury tower with 125 units dubbed Ward Gateway.
Sales have yet to begin for Ke Kilohana. Sales for Gateway began in July at the same time as Ae‘o, though Hughes Corp. has yet to disclose Gateway sales results. The company said it expects sales for Gateway to be slower than its other towers because the pool of buyers being targeted is smaller. According to real estate brokerage firm Honolulu HI 5, Gateway unit prices range from $1.5 million to $23 million.
“With this product, we are bringing a level of product quality and overall experience never before seen in the market that sets a new peak for Ward Village,” Hughes Corp. said in its financial report. “As a result, we are expecting a more measured and longer time period for absorption than at our other Ward Village developments.”
Hughes Corp. has a master plan to develop up to 4,300 condo units in 22 towers along with about 1 million square feet of retail space at Ward Village converted from mainly retail and industrial space on 60 acres formerly known as Ward Centers.
About 87 percent of existing retail space at Ward Village, which includes Ward Warehouse and Ward Centre, is leased. In the fourth quarter, retail operations at Ward Village generated $6.2 million in net operating income, the same as a year earlier.
Shares of Hughes Corp. stock closed at $92.79 Monday on the New York Stock Exchange after the earnings announcement, down $1.40 from $94.19 on Friday. Shares of the company’s stock in the last 52 weeks have closed between a high of $159.12 on April 6 and a low of $81.34 on Feb. 11.
FOURTH-QUARTER NET
$25.9 million
YEAR-EARLIER NET
$31.9 million
