New tower’s site blessed, firm praised
DENNIS ODA / DODA@STARADVERTISER.COM
Simon Kim, left, CEO of SamKoo Corp., appeared with Gov. David Ige and and Timothy Yi, president of SamKoo Pacific, at Wednesday’s groundbreaking ceremony for Kapiolani Residence.
COURTESY SAMKOO PACIFIC LLC
A rendering of the tower’s typical kitchen layout.
COURTESY SAMKOO PACIFIC LLC
A rendering of Kapiolani Residence.
A major addition to urban Honolulu’s affordable-housing supply is about to get started, after a South Korean development company blessed the site Wednesday for a predominantly affordable condominium tower near Ala Moana Center.
SamKoo Pacific LLC held the blessing and groundbreaking ceremony at which praise was heaped on the company by city and state leaders. They congratulated the development firm for trying to address Honolulu’s critical shortage of affordable homes in a prime area with the $225 million project called Kapiolani Residence.
$225M—Cost of project
485—Units ranging from studios to three-bedroom homes
292—Units designated for residents with low to moderate incomes
Timothy Yi, company president, said construction should begin next month and that interest from prospective buyers was incredibly strong at an initial homebuyer seminar two weeks ago when prospective buyers took close to 1,500 information packets.
“That’s way more than what we expected,” he said.
More seminars are planned, including one Saturday for which there are already between 800 and 900 registrants.
Kapiolani residence is slated to rise at 1631 Kapiolani Blvd. on 1.3 acres immediately mauka of the Ala Moana Hotel, a parcel that SamKoo bought in 2007 for $15.5 million.
The tower is designed to have 485 units ranging from 400-square-foot studios to 1,230-square-foot homes with three bedrooms. About 60 percent of the tower, or 292 units, will be reserved for residents with low to moderate incomes and priced to be affordable under federal guidelines. The balance of the units will be sold at market rates.
Overall, prices are expected to range from $272,000 to about $350,000 for studios, from $308,000 to about $600,000 for one-bedroom units, from $418,000 to the upper $700,000s for two-bedroom units and from $587,000 to $990,000 for three-bedroom units.
For the affordable units, buyers cannot earn more than 120 percent of the annual median income for Honolulu, which equates to $84,480 for a single person and $120,600 for a family of four. Some units also will be reserved for households who earn no more than 80 percent of the median income, or $56,320 for a single person and $80,400 for a family of four.
Sales have not yet begun through brokerage firm Locations, and will involve a lottery drawing for the affordable units sometime this fall. Applications for the affordable units are due by Aug. 31.
If construction goes as planned and is finished in about two years, SamKoo expects to then start construction on a second condo tower with predominantly affordable homes on a nearby site on Kapiolani Boulevard adjacent to a planned city rail station, Yi said.
SamKoo obtained approvals and assistance for its first tower from the city and state. The contributions included exemptions from city zoning rules, city permitting fees and the state general excise tax.
The zoning exemptions allow the tower to rise 400 feet high, which is in line with what the city envisions for sites close to rail stations that include the Kapiolani Residence site, but is 50 feet higher than the standard limit.
The tower also is going to be built closer to streets and property lines than ordinarily permitted, and will be about 2-1/2 times more dense. Under the tower’s approval by the City Council, the city will waive about $17 million in fees for permitting, park dedication and other things.
Initially the city Department of Planning and Permitting objected to some of the breaks, which contributed to “trials and tribulations” that City Council Chairman Ernie Martin said endangered the project but were fortunately overcome.
“To their credit and through (Yi’s) leadership and SamKoo’s commitment they actually came back with a better project,” Martin said.
“It was a difficult time,” Yi said. “But we finally were able to come through and bring this project forward.”
Gov. David Ige commended SamKoo for helping address a shortage of affordable housing in Honolulu that contributes to the city’s overwhelming homeless population.
“Providing housing for our people is one of the biggest challenges for us all,” he said. “This project is a great example of what can be accomplished when city, state and federal incentives really work together to make a project that is truly affordable for our community.”
Mayor Kirk Caldwell also acknowledged the “incredible challenges” involved with affordable housing in Honolulu, and praised SamKoo for building some in a prime area so close to the state’s biggest shopping center and not far from Waikiki.
“It’s so exciting to see what’s happening on this piece of property,” he said.
23 responses to “New tower’s site blessed, firm praised”
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Affordable? Are you kidding? To whom?
agree…too expensive for me by far
Actually to a lot of people. Don’t be a hater if you can’t afford one of these places. To me it’s reasonable considering the housing market here. After all, everything is relative. If you don’t like it, earn more money or buy a residence where it’s cheaper.
Affordable? Yeah right, to foreigners and outsiders not to the local community.
Exactly. Notice the developer willfully failed to mention those dreaded two words of condo living – “Maintenance Fees.” As we have seen over the decades, these can start off low then jump sky high as building maintenance costs go up.
Those prices are NOT affordable. Hopefully not another ugly building from the korean developers. Seen the new building in Hawaii Kai, its the worst looking building ever.
Affordable perhaps, all relative. But your observation of the HK one is right on.
Agree. Up to $990,000 for a three-bedroom condo is NOT affordable for a family of four making less than $120,600 which is the max income a family of four can qualify. The math don’t add up on how a family of four on an income of less than $120,600 purchase a three-bedroom condo that cost between %587,000 to $990,000? Actually that is a rhetorical question, what will happen is an investor will use their adult kid or friend with low income to qualify then when it is time to put about 20 percent down which would be up to near $200,000 the developer will take the cashier check, no questions asked on how the person came up with the money. Then when the balance is due they come up with the balance and as long as the check is valid, the developer does not care where the money comes from. Then after one year or so the true owner can flip the condo for a big profit or turn it into a rental to make good money.
Yes. This is the model. You forgot to point out the home equity loan at 5% being used to purchase a property that will increase in value at 10-15%. An almost no lose situation if you can handle a possible temporary economic down turn. Even then, in the end, it’s a great investment. Why would people invest anywhere else?
Can’t begrudge the people or the developer, but the model shows how skewed affordable housing is on Oahu.
Which is why housing authorities should develop stricter rules regarding who can purchase and sell properties like this. As shown on the news, 801 South Street is a prime example of the need to have strict criteria for buyers for properties like this. When it comes to this much potential profit I can’t really blame anyone who choses to buy as an investment. I would too if given the opportunity.
Actually I just went to their website and there’s a requirement for the buyer to be an owner-occupant for 10 years so they couldn’t sell after 1 year. If for some reason they do sell within the first 10 years the HHFDC has the first option to buy the property back. There’s also some kind of agreement where the HHFDC shares in the profits if the owners decide to sell. This is better than 801 South Street, which only has a 1 year owner-occupant requirement and after that the owner is free to do whatever they want with the property and gets to keep any profits.
Okay, they cannot sell for 10 years but what is to stop a condo owner from renting the property? Actually the location right close to Ala Mo Center, Magic Island, the Convention Center, etc. would be perfect for illegal type of rental’s that do not pay Hawaii taxes where tourists around the world, go online and rent the fully furnished property for a week or month and pay online so the State would have a hard time collecting on taxes and the property manager would could not tell who are renters and who are true home-owner occupants. If the renter has any condo problems they would be instructed to contact the condo owners own property manager and not SamKoo’s actual property manager. A studio to 3 bedroom rental for tourists would be way cheaper than staying at Waikiki hotel since the condo owner does not have to pay taxes or union rate employees. Just need to hire a cleaning service to clean the room after the renter leaves and get it ready for the next renter. Hmmmmmm. Wonder if I can scrape up enough money and keep the IRS reported income below the threshold to get in on some of this action?
another chateau blue?
What’s with Ige there? Bet the developers contribute to his campaign. Isn’t there more important things for the gov to do?
true colors are shining through……..green…….dong kajiwa….ara tanke?
moderator……….translation made simple…..show me the money ..understand?
I bet those developers are bummed out that the rail will probably not end up going all the way to Ala Moana.
Developers don’t give a rip whether the rail is built or not. The ONLY purpose of the rail project was to allow TOD development, which justified bypassing almost all current rules and regs. regarding ‘exemptions from city zoning rules, city permitting fees and the state general excise tax’. Setbacks, height limits, density, and the “city will waive about $17 million in fees for permitting, park dedication and other things”. That was the purpose of the Oahu rail project and why developers and most importantly local construction and other unions supported the rail project. The Oahu rail project was NEVER about improving public transportation for commuters.
50 feet above the limit, no GET to be paid, closer to the street and property lines than allowed and $17 million in fees lost to the City. More proof the rules don’t apply to the well connected.
Parts of Kona street next to the shopping center appear to have sinking problems. When it rains, cars have major problems. How can the rail system use this street?
Rules? Building restrictions? Codes? Permit fees? Ha! Musta been some big campaign donations… 🙁
Looks nice. Should have made half available to senior citizens soon to be needing a small place to downsize to. Need domestic cleaning help, cafeteria or in-house kitchen and food delivery, part-time nurses, grocery store and pizza delivery services, Thai motorcycle taxis, jeepney services, Uber and Lyft services for short haul trips. Seniors have lots of money and are willing to pay for these wishes. Make them your next project.
For all the exemptions they got, we should have required that the entire building be affordable ………not just 60%.
I don’t think people with moderate incomes are going to be able to afford these condos. Just like the 2nd tower of 801 South, the units were larger than the 1st tower. Because they were larger, they were more expensive, but one still had to meet the “affordable” income levels. So people could meet the low income requirements but they would not be able to make the monthly mortgage payments of the higher priced units in the 2nd tower. So they sold out the 2nd tower of 801 South but a lot went at market rate since they couldn’t get enough moderate income people to qualify for the mortgages.