The $275 million Ritz-Carlton Residences Waikiki Beach tower opened to hotel guests today with enough fanfare to explain why the developer is consolidating other Waikiki lots to build another large-scale project close to the Beach Walk.
Irongate, owner and developer of the Ritz-Carlton in Waikiki, is exploring options for further Waikiki expansion near its lots at 260 and 268 Beach Walk. Irongate also built Trump International Hotel & Tower Waikiki Beach Walk, which opened in 2009.
“Irongate is still very bullish on Waikiki,” said Lance Wilhelm, managing principal for Irongate. “Occupancy rates as well as the way that Trump performs and our expectations for the Ritz-Carlton continue to suggest to us that there are still opportunities in Waikiki.”
“We’re working on consolidating to create adequate space (on Beach Walk) to build, and then we’ll work to put something great together,” Wilhelm said. “We think Saratoga (Road) will be the next part of the cycle. The way our proprieties have performed has left us nothing but optimism for the future.”
Mixed reactions
The Ritz-Carlton Residences opened with only one of 307 units left to close. Wilhelm said the property’s Tower 2, which is under construction and is expected to open during the second quarter of 2018, already has sold 80 percent of its 246 units. The company is expected to spend another $180 million completing that tower, which will be connected to the first tower by a podium.
The Honolulu City Council just gave its approval to link the two controversial projects. Opponents objected to the project’s size, including the 350-foot height of Tower 1, and the direction of its buildings, which were said to block views and sun. They also complained about Tower 1’s bright stairwells, which shine into nearby condos. Waikiki Neighborhood Board Chairman Bob Finely testified against the project, which he said was voted down by his board and was unpopular with constituents.
“Waikiki is becoming the dumping ground for every developer’s skyscraper idea. It seems like the more open air space that can be filled in, the more the Zoning Committee likes it. And the city gave this developer two huge towers — side by side. Donald Trump wants his wall, and Honolulu City Councilman Trevor Ozawa does, too,” said Waikiki resident Denise Boisvert-Jorgensen.
But proponents, including Mayor Kirk Caldwell, made a strong case for the towers, saying they would gentrify a blighted portion of Kuhio Avenue, improve safety and provide needed hotel rooms and jobs. The Ritz-Carlton’s retail space includes a BLT Market, which opened in June, and a Dean & DeLuca upscale grocer, which is scheduled to open in mid-September.
George D. Szigeti, president and CEO of the Hawaii Tourism Authority, said the Ritz-Carlton brings elegance and luxury to Kuhio Avenue and adds a level of sophistication to a part of Waikiki undergoing significant and much-needed enhancements.
“It is vital that Hawaii’s tourism industry is able to offer a variety of quality lodging accommodations to match the desires and pocketbooks of global travelers. Ritz-Carlton is a brand name of choice for discerning travelers and will provide them with another reason to choose Waikiki as their preferred destination,” Szigeti said.
High expectations
Douglas Chang, Ritz-Carlton Residences Waikiki Beach general manager, said Monday that his staff of 110 was ready for today’s opening. Chang said Bob Kharazmi, global operations officer for the Ritz-Carlton Co., attended the ceremony. A cadre of Ritz-Carlton’s best trainers from around the world also flew in July 5.
“There’s an extremely high expectation. We have this legendary reputation around the world and only one chance to open. We are preparing our ladies and gentlemen to deliver perfect service,” Chang said. “It’s this culture that says, ‘Absolutely, my pleasure.’ That’s why you have to find people that find joy in bringing joy to others.”
Chang said opening-day bookings are low, but occupancy is expected to ramp up considerably by August. There are high expectations for the Christmas holidays, he said.
“Demand is very strong in Waikiki, so we are opening at the perfect time,” Chang said.
Owners of about 240 Ritz-Carlton units are participating in the hotel rental program. Published hotel rates start at $599 for a studio and go up to $3,299 for the best of the three-bedroom premier category. All units are ocean-view. In addition to coming with amenities like personalized check-in service, there are staff members to clean units twice daily and perform extras such as unpacking and packing suitcases, stocking refrigerators and arranging for in-room dining or chefs.
While the Ritz-Carlton is a large global hotel company, Chang said 90 percent of the hotel’s hourly staff and 60 percent of its leadership team are local hires.
Looking ahead
Chang said most of the staff for Tower 1 already has been hired, but he is still looking for a spa director. That director will hire about 12 to 15 staff members for a Ritz-Carlton-branded spa, which will open in mid-September around the same time as Sushi Sho, an exclusive sushi spot developed by Keiji Nakazawa.
Joseph Toy, president and CEO of Hospitality Advisors LLC, said Ritz-Carlton will be well received, and he is excited to see what Irongate does next.
“If they are able to assemble enough smaller, individually owned parcels along Beach Walk and Saratoga, they could have the possibility of turning that area of Waikiki into its next gateway,” Toy said.
Finley said early community outreach should be part of Irongate’s future plans.
“I hope they are much more open and have large public hearings about the project before it gets too far underway,” he said. “Our experience is the more transparent that a developer is, the more likely they are to get support. If they just come and say this is what we are building, there will be resistance.”
