KALAHEO – Normally, a developer doesn’t react with shock when told how phenomenally successful the first round of sales is for his residential subdivision.
Even with the backdrop of an improving local economy and general lack of inventory developed after 1992’s Hurricane ‘Iniki rumbled across the island, the principal of a 75-acre, 210-lot residential subdivision here admitted amazement when told that, of the first phase’s 74 lots for sale, only 10 or 11 were left unsold as of late last week, after just five months on the market.
After all, an akamai developer like Dan Verdoorn of Kakela Makai Partners I did his homework, spending two weeks conducting market research not only on the Kaua’i market, but on statewide housing trends and expectations as well, before finally deciding it was time to turn some dirt.
The local reaction to the initial sale of lots, primarily through Po’ipu-based Makai Properties, did catch Verdoorn by surprise, he admitted.
He said he underestimated pent-up demand not only for residential lots, but for house-and-lot packages. In the development business, though, this was not a bad underestimation.
Kakela Makai, located along Puu Road not far from Kukuiolono Golf Course, features panoramic ocean and mountain views, and over the five months of sales lots have been gobbled up at a rate of around 12 a month.
Verdoorn expects that pace to eventually slow to around two sales per month, predicting a build-out period of seven to eight years for the entire subdivision. That would mean somewhere between 200 and 210 total homes.
The subdivision’s second phase, another 40 lots, is planned for spring of 2003. Also beginning at that time will be construction on the subdivision’s recreation center, to include a clubhouse, large barbecue area, large swimming pool, spa, and other amenities.
Although pleasantly surprised with market reaction to the first phase of the subdivision, Verdoorn was in a position to be patient with this project.
Born and raised in Denver and a one-time Kaua’i resident who returned to the Rockies after being rocked by ‘Iniki, Verdoorn purchased the Kalaheo property between 1990 and 1991.
‘Iniki, of course, visited in 1992, and he realized that a market for Kakela Makai would be a few years in the formation, so the property sat idle.
He and his father, who built homes at Princeville and a small development elsewhere in Kalaheo, have a company which has been developing subdivisions and building homes in Denver for almost 50 years.
Currently, the company has 40 separate projects, and 28 homes under construction, in Denver.
Still, Verdoorn makes it to Kaua’i once a month to personally view the progress of Kakela Makai.
A probable driver of the voracious appetite people have shown for the project is the price, around $150,000 for a 10,000-square-foot lot. In doing his research, Verdoorn found comparable-sized lots on Maui and O’ahu selling for between $500,000 and $750,000.
Business Editor Paul C. Curtis can be reached at mailto:email@example.com or 245-3681 (ext. 224).