The one-year old Allure condo building in Waikiki has gone through some recent enhancements, while at the same time dropping the prices on its units in an effort to sell out the struggling building. The Allure Waikiki is an upscale residential tower in Waikiki that hasn’t exactly sold how the owners thought it would.
Allure Waikiki was one of the major projects that in Honolulu that got caught up in the major economical downturn that occurred a few years ago. The Allure has been receiving enhancements from local contractors after Chicago-based developer Fifield Cos. Originally developed the project.
There are also two other upscale condo buildings that are getting upgrades nearby. The Moana Vista in Kakaako, a tower where construction stalled until a new developer took over and re-branded it Pacifica, and the loft-style mid-rise Vanguard Lofts. Pacifica and Vanguard Lofts are nearing completion. Both if them will be available to the public shortly.
Fifield launched sales in 2007 and completed the 35-story Allure in June 2010. Property records show the developer managed to sell 113 units — or 39 percent — prior to losing ownership in November to ST Residential.
The partnership, which comprises the Federal Deposit Insurance Corp. and investment firms including Starwood Capital, TPG, Perry Capital and WLR LeFrak, took over Allure in connection with a $169 million construction loan Fifield obtained from Corus Bank of Chicago. After the bank failed in 2009, the investment firms bought a 40 percent stake in the bank’s $4.5 billion real estate loan portfolio. The FDIC retained a 60 percent stake.
“Allure Waikiki is a fantastic property in a very desirable location,” Wade Hundley, ST Residential chief executive officer, said in a statement announcing the November takeover.
Since acquiring Allure, ST Residential has begun upgrading the property’s lobby, grand lanai, pool deck and some units. Upgrades include an espresso bar in the lobby and a fireplace and water fountain on the lobby’s lanai. The work is scheduled to be completed by late October and cost “several” million dollars, according to the firm.
ST Residential also reduced unit prices, according to brokers. A July price list indicated price reductions from at least $1.6 million to $1 million on a 1,616-square-foot unit, and from $912,000 to $706,900 on a 1,216-square foot unit. While these numbers are down, they are still very high for what you get. However, this is Hawaii, and even though 30-year mortgage rates are at an all-time low, the money needed to purchase these units is still a lot.
Between the November takeover and late August, ST Residential has sold 36 units for prices from $569,660 to $1.45 million, according to property records.
The owner said momentum continues to build with 20-signed contracts over the past two months.
Tony Kawaguchi, an agent and vice president with Realty Executives Oahu who has had a couple of buyers pursue Allure units, said the building is challenged by limited views and some relatively small units compared with the nearby Watermark Waikiki.
“They definitely changed the look a lot — it has a more modern feel,” he said of the Allure.
Kawaguchi also said the new owner is making only handfuls of units available for sale at a time to reduce the impression that there is a glut of unsold units. “That definitely should help them sell some,” he said.
This story was originally reported by Andrew Gomes and the original source can be found here.