Capitol Place Picks Up $154M Financing

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HONOLULU-The local real estate market has increasingly become a home away from home to many Southern California players. In the latest deal, developers of Capitol Place, a 33-story high-end residential tower, picked up a $154 million construction loan. The Southern California angle comes from the Irvine, CA office of Fremont Investment & Loan.

A Fremont team led by Lesley M. Love, VP and regional manager and Kenneth A. West, VP and senior loan originator, closed on the deal. Love and West were unavailable for comment, but the firm has been a major player in Hawaii in recent years.

Since entering the market in 2001, Fremont has committed nearly $1 billion in financing for some 30 properties throughout the Islands. Fremont has focused its attention primarily on Oahu, Maui, Kauai and the Big Island.

As for Capitol Place, the project is a development of PMK Development LLC, a joint venture of Hawaii-based developers The Pflueger Cos., The MacNaughton Group and The Kobayashi Group. Previously, MacNaughton and Kobayashi teamed to build the 40-story 248-unit Hokua condominiums in Honolulu.

The Capitol Place project is located on Queen Emma Street in Downtown Honolulu. It is just north of the CBD. The residential element will sit atop a 6-story podium, which will contain 40,000 sf of retail and commercial space.

The residential section will include 394 condo units, with the average asking price said to be in the $660,000 range. The project offers views of Diamond Head, the historic Capitol District and the ocean. The majority of the project was presold at loan closing. Rockpoint Group LLC provided the mezzanine financing for Capitol Place.

Just across the street from Capitol Place is another condo project with a Southern California connection. Santa Ana, CA-based Michael Harrah is the developer of The Pinnacle Honolulu.

The 36-story project will only have 39 condo units, but they will be luxury units. The project will have no more than two units per floor. While many buyers have ponied up the $2.4 million price for an entire floor.

San Diego-based The Shidler Group is another Southern California company with a major stake in Hawaii. The firm is considered the largest owner of commercial property in the state. Matthew Root, a partner with The Shidler Group says the firm likes the Honolulu market, a place “where inefficiencies still exist.”