Burnham USA Equities Inc. is the latest local developer to tap the tony Hawaiian resort community of Wailea for a major investment.
The Newport Beach-based commercial developer and investor, best known locally for its South Coast Collection design and culinary center in Costa Mesa, closed on the purchase of Shops on the Green this month. The retail center is on the southern coast of Maui.
Terms of the sale were not disclosed. Marketing materials for the 22,000-square-foot center placed a $21.5 million price tag on the property, or nearly $1,000 per square foot.
Per-square-foot prices in that range are rare for retail properties in even the priciest coastal markets in Southern California, whose affluent demographics are similar to those of Wailea, said Scott Burnham, chief executive of Burnham USA.
“It’s not unlike areas like Newport Beach and La Jolla,” he said. “There’s a lot of barriers to entry.”
It’s Burnham’s first commercial investment on Maui. Most of its investments are closer to home; it owns owns a dozen properties in the area around Newport Center, one of its largest markets.
“We’ve been eyeing investments in specific areas of Hawaii for years, and securing a quality project in Wailea is a real coup,” Burnham said.
The 6.3-acre property, which is being renamed Wailea Village Center, comes with entitlements for an additional 23,000 square feet of retail, which Burnham said it plans to develop immediately.
It bought the center from Ronald Allred, who is best known as the founder and developer of Telluride Ski Mountain Village in Colorado.
More Locals on Island
Burnham is the third Orange County real estate company with big development plans in Wailea.
Aliso Viejo-based Sunstone Hotel Investors Inc. is in the early stages of an estimated $65 million renovation of its 544-room Wailea Beach Marriott Resort & Spa, an oceanfront property about half a mile from Burnham’s retail center.
Last year, Sunstone paid $325.7 million, or nearly $600,000 per room, for the 22-acre property, its largest acquisition in several years.
The investor said this month that it’s spending upward of $27 million this year alone on upgrades to the resort. It expects the renovations to help it capture more high-end group business and leisure travelers and to bring the property in line with other resorts in the area.
The Marriott is next door to the Grand Wailea, arguably the best-known resort on Maui. The Grand Wailea sold in 2013 for a reported $774 million, or just under $1 million per room.
Also under construction in Wailea is a 200-room, four-story Residence Inn by Marriott being built by Irvine-based R.D. Olson Development.
The hotel is on about 6.4 acres and across the street from Burnham’s new retail center.
It is R.D. Olson’s second Maui hotel development. The company opened a Courtyard by Marriott in 2012 near the island’s main airport.
Burnham’s Wailea Village Center also sits next to the community’s best-known retail property, the Shops at Wailea, which is about 160,000 square feet and could be on the market for sale, according to local news reports.
It has an assessed value of nearly $120 million, or $750 per square foot.
