How A Big Mainland Developer Learned To Thrive In Hawaii
Howard Hughes Corp. seems to stay on course as it navigates burial grounds and being in the path of rail.
When , Inc. was planning fits first Hawaii store in what鈥檚 now Ward Village in 2006, the company got some bad news: The proposed site also was the location of a Native Hawaiian burial ground.
“This is not something we’ve ever had to deal with before, and we’re just trying to figure out what the right thing to do is,” a Whole Foods spokeswoman told at the time.
Ultimately, with the project鈥檚 developer stalled in controversy, Whole Foods shifted gears and built its store in .
Fast-forward 12 years, and Whole Foods is making a second run at Kakaako. And again, bones 鈥 iwi kupuna 鈥 have been found at the new site on the ground floor of developer tony condominium project.
But this time the project has moved forward without a hiccup.
And it鈥檚 not a lucky fluke.
鈥淭he (developer’s) leadership team has never needed any convincing as to why they have to care for burials,鈥 said聽, a Hawaiian activist who is also chair of the , which manages Native Hawaiian burial sites and ancestral remains.
The way Howard Hughes has handled sensitive iwi discoveries to the satisfaction of the parties involved seems emblematic of its approach to community outreach.
鈥淭heir responsiveness regarding iwi issues is akin to none,鈥 said Wong-Kalu, who has been a cultural advisor to the company.
Headquartered in Dallas, owns, manages and develops commercial, residential and mixed-use properties in 14 states in the U.S., including several master planned communities. The company is named for the film and aviation magnate who in the 1950s acquired a master planned community near Las Vegas that’s still in the company鈥檚 portfolio.
Since Howard Hughes embarked on its first Hawaii project in 2014, the company has built two condo towers and has two more in the works. All told, this first phase will bring nearly 1,400 units on line with a total price tag of more than $1.46 billion. And the company鈥檚 master plan calls for much more down the line.
Todd Apo, a former Honolulu City Council member and now vice president of community relations for Howard Hughes鈥 Ward Village project, said the company has tried to avoid the seemingly small gaffes that can blow up and stymie a development.
鈥淗aving sat six years at the City Council,鈥 Apo said, 鈥淚 know how some of that craziness can happen.鈥
Willing To Listen
One key is talking to the right people early. For instance, as Howard Hughes embarked on plans to refurbish Kewalo Basin Harbor, Apo said, the company reached out to , an activist group that in 2006 thwarted developer聽 to acquire state-owned waterfront property in Kakaako to develop a $650 million mixed-use condo project.
Friends of Kewalos has been concerned about the sale of public land and access to popular surf spots near Kewalo Basin. And with Howard Hughes borrowing about $11.6 million to invest in the harbor, Apo said the company wanted to assure Friends of Kewalos that the company wouldn鈥檛 block access to the ocean.
“We disagree at times, many times in fact,” said Friends of Kewalos president Ron Iwami.
But that’s only natural, Iwami said: The group’s mission is to care for the ocean and waterfront, and Howard Hughes’ is to develop its property. The key, Iwami said, is that the company is willing to listen.
“It’s like an open-door policy,” he said.
When Howard Hughes was planning another condo project in Aalii, Apo said, it held a community forum in the courtyard of the IBM Building where it鈥檚 headquartered and surveyed people from the community to find out what they’d want in a new project. Several of those ideas were incorporated into the building, said Tom聽Schnell, principal of , which is working with Howard Hughes.
鈥淭hey鈥檙e trying to create a community and not just do a development,鈥 Schnell said. 鈥淎 lot of developers don鈥檛 make that distinction.鈥
It鈥檚 not surprising that Kakaako has seen a building boom as the economy has recovered. Under a state law passed in 1976, the area is a special development district, governed by a state board, the . HCDA鈥檚 is to promote development in the area to address Honolulu鈥檚 lack of affordable housing, among other things.
Whether HCDA is fulfilling that mission is a matter of frequent debate. For its part, Howard Hughes is setting aside hundreds of units at below-market rates. At Ke Kilohana, being developed at Ward Avenue and Halekauwila Street, 375 of 424 units are being sold at prices affordable for people earning an average of 120 percent of the area median income or less, Apo said. And 150 of 751 units at Aalii are being set aside as affordable housing, Apo said.
This might be enough to fulfill HCDA鈥檚 requirements, but it still seems out of reach for neighborhood workers like Michelle Domingo, an instructor at who is studying to apply for master鈥檚 programs in nursing.
鈥淚鈥檓 here all the time,鈥 she said, 鈥渂ut I can鈥檛 afford to live here.鈥
Dealing With Rail
The HCDA isn鈥檛 the only government agency Howard Hughes has to deal with. There鈥檚 also the Honolulu Authority for Rapid Transportation, which manages the $8.17 billion rail project that will cut through the heart of Howard Hughes鈥 properties.
The company stands to benefit from the transit project, but in the meantime it must navigate a tricky 鈥 and occasionally rocky 鈥 relationship with rail officials over its properties that lie in the route鈥檚 path.
At HART鈥檚 Dec. 14 meeting, for example, the rail board opted to start the condemnation process against several Howard Hughes parcels even though the city鈥檚 latest appraisals for that land were outdated and negotiations for their purchase were far from over.
Mark Murakami, an attorney for Howard Hughes,聽argued that day that the board鈥檚 condemnation moves were premature and violated the federal land-acquisition process that HART agreed to follow.
He also told the board that Howard Hughes learned about the proposed condemnation only a couple of days before the meeting — and that the link on HART鈥檚 website to the details was broken so the company couldn鈥檛 evaluate the proposal.
鈥淭hese plans have changed dynamically several times, and we have big buildings going up and operating shopping centers with impacts that need to be learned and judged,鈥 Murakami said.
HART board members didn鈥檛 appear very sympathetic.
鈥淲e would hope that Howard Hughes, who is a very big player in Kakaako and very well-respected, would cooperate with us in this process, rather than being an impediment,鈥 HART board member Ember Shinn told Murakami. She reminded him that Howard Hughes advertises its properties abroad as 鈥渃lose to rail.鈥
鈥淵ou need to make sure that you take it back to your client the board鈥檚 firm commitment that this rail is going to be built, it is going to be built through Kakaako, and that we would hope that you would cooperate with this endeavor,鈥 Shinn said.
After a pause, Murakami noted that HART鈥檚 own real estate plan calls for condemnation 鈥渙nly after all reasonable efforts鈥 to get it by negotiations 鈥渉ave been exhausted.
鈥淲e have not been afforded that with only two days’ notice,鈥 he said.
A New Version Of Ward Warehouse
One casualty of Howard Hughes鈥 redevelopment is the old Ward Warehouse. The former low-rise mall between Ala Moana Boulevard and Auahi Street is being replaced with luxury condos. And that鈥檚 meant the loss of cheaper spaces for small local companies.
But at Auahi and Queen streets, Howard Hughes has built what amounts to a new-fangled version of Ward Warehouse. At lunchtime on a recent Friday, the South Shore Market was buzzing. Diners were savoring stacks of pancakes and $15 burgers at Scratch Kitchen and Meatery and eating ice cream at Lucy鈥檚 Lab Creamery.
In the market鈥檚 main arcade, next to a 鈥渓iving wall鈥 of ferns and shrubs, students pored over books and sipped coffee at a long communal table. Nearby, at , Gadea Perez-Andujar was dropping off some brass and gold earrings to Mori鈥檚 owner, Aly Ishikuni-Sasaki.
Mori is like an artsy flea market without the dust, a retail space for dozens of local brands. In addition to jewelry from companies like Perez-Andujar鈥檚 , there are T-shirts made by Trades Hawaii and pet beds by , a local furniture maker. It鈥檚 more like a museum gift shop than mall retailer.
As Ishikuni-Sasaki describes it, following her passion to be an impresario for local creatives made her a Kakaako nomad for several years until she connected with Howard Hughes. In 2014, she opened a shop in Ward Warehouse knowing it would soon close. She moved to South Shore Market when it opened in 2016.
Although South Shore Market shares a building with corporate behemoths like Nordstrom Rack and Pier 1, Ishikuni-Sasaki said Howard Hughes鈥 desire to work with small entrepreneurs is sincere.
鈥淚t鈥檚 real, and that鈥檚 why so many people want to open up their shops here,鈥 she said. 鈥淎nd for tourists, it鈥檚 exciting too because they get to experience the true Hawaii creative culture.鈥
Native Hawaiian lawyer Natasha Baldauf chronicled in a 聽that Kakaako was once a thriving community with agricultural terraces, docks for foreign ships and recreation areas. King Kamehameha I, the first monarch to unite the Hawaiian islands, had a residence there. In 1853, sailors arriving on a foreign ship brought smallpox, Baldauf wrote, infecting thousands of Native Hawaiians, many of whom died and were buried in shallow graves.
Wong-Kalu, the kumu hula who is on the Oahu Island Burial Council, said she agreed to work as a cultural advisor to Howard Hughes because the company seemed sincerely willing to treat the iwi kupuna with respect.
Wong-Kalu said she understands if people criticize her for working for a developer and then serving on the burial council, but she said she recuses herself from any matters involving Howard Hughes.
To Wong-Kalu, what’s important is if the company is willing to respect the area’s history. And she says it’s doing that.
鈥淚 have very high expectations,” she said. “And so far they鈥檝e been able to meet those cultural expectations.”
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About the Authors
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Stewart Yerton is the senior business writer for 天美视频. You can reach him at syerton@civilbeat.org.
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Marcel Honor茅 is a reporter for Civil Beat. You can email him at mhonore@civilbeat.org