Wells Fargo Provides $238M Refinancing for Howard Hughes Corp.’s Ward Village in Honolulu

by John Nelson

HONOLULU — An affiliate of Wells Fargo & Co. (NYSE: WFC) has completed the $238 million refinancing of maturing debt for Ward Village, a 60-acre urban master-planned development underway in Honolulu.

The Howard Hughes Corp. (NYSE: HHC) is the master developer of Ward Village, which features three condominium towers under construction. Upon completion, Ward Village will comprise 4,000 residences and 1 million square feet of retail and restaurant space. The development is situated between downtown Honolulu and Waikiki in the Kak’ako district.

Ward Village is the only project in Hawaii to receive LEED Platinum certification for neighborhood development (LEED-ND) and the largest one in the United States to receive LEED-ND Platinum certification.

The financing is secured by the existing Ward Village commercial properties, excluding the condominium towers currently under development.

Ward Village’s three condominium towers underway — Waiea, Anaha and Ae ‘o — will open in late 2016, 2017 and 2018, respectively. The three towers will feature ground-floor retail space, including a Nobu restaurant, Merriman’s restaurant and the largest Whole Foods Market in Hawaii. Other mixed-use condo buildings within Ward Village include Gateway Towers and Ke Kilohana, which features a 23,000-square-foot, street-level Longs Drugs store.

Ward Village is situated between downtown Honolulu and Waikiki in the Kak’ako district.

Ward Village is situated between downtown Honolulu and Waikiki in the Kak’ako district.

The financing allows Howard Hughes Corp. to release collateral to develop additional residential condominium towers and retail properties across the master-planned community.

The new non-recourse term loan bears interest at one-month LIBOR plus 2.5 percent and has an initial maturity of Sept. 12, 2021, with two one-year extension options. Howard Hughes Corp. swapped $119 million of the loan to a fixed interest rate of 3.64 percent through its initial maturity date, representing an all-in interest rate of approximately 3.33 percent based on the current one-month LIBOR rate.

“This financing provides us with the flexibility needed to advance our development plan, and with it we are pleased to continue our close relationship with Wells Fargo,” said Grant Herlitz, president of The Howard Hughes Corp.

The Howard Hughes Corp. owns, manages and develops commercial, residential and mixed-use real estate throughout the United States. The company’s properties include master-planned communities, operating properties, development opportunities and other assets spanning 16 states from New York to Hawaii. The company has more than 1,100 employees in its offices in New York, Maryland, Texas, Hawaii and Nevada.

— John Nelson

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