The real estate market is exceptionally hot right now, but not all areas are seeing the same level of demand. In this Fool Live video clip, recorded on Oct. 1, Fool.com contributor Matt Frankel asked Howard Hughes Corporation (NYSE:HHC) CEO David O’Reilly where he sees the biggest opportunities right now.
Matt Frankel: I know you have a lot of projects in the pipeline. In addition to 250 Water Street, I know you just announced, I think 2 billion dollars in accelerated development. I want to say or 2 million square feet, maybe it was. What’s the most exciting opportunity in the pipeline to you right now? Is it multifamily, which I know isn’t particularly hot market right now, is it building out downtown districts? Is it land sales? Where do you see the best opportunity right now?
David O’Reilly: Right now, coming out of the pandemic, we have been firing on all cylinders. While we’ve done a lot of new developments in multifamily, we’ve done a number of office developments in downtown Summerlin and Columbia. It’s tough to say that any one is more attractive because it’s very much market driven, location driven. Our job is not just to find the best risk-adjusted returns, but to meet the demands of those consumers because those in turn drive the best returns.
We haven’t talked much about Ward Village yet, which is our beachfront community, 60 acres in Oahu right between Waikiki and Honolulu. That is among the most exciting projects in the company. Right before the pandemic started in January of 2020, we launched our seventh condo tower, Victoria Place, and it was right at the beginning of COVID. Obviously it was concerning when we did that, but it actually turned out to be our fastest-selling tower ever at Ward Village. Our [unclear] throughout the pandemic on an entirely virtual digital sales campaign, which the team executed incredibly well.
As of the second quarter, we’re already 93% sold on a building that won’t complete until 2024. With Victoria Place, we’re just under halfway through our entitlements there. So there are six or so additional towers that we’ll continue to develop there and for sale condominiums that will completely revitalize that neighborhood, taking down older, tired-er buildings, World War II-vintage retail space, and creating first-class shopping, dining, and entertainment at the ground floor of these towers.
Frankel: I’m glad you brought up Ward Village because I feel like it’s a lot like the Seaport in the sense that it gets overlooked by investors a lot. Because it’s relatively smaller scale than some of your master-planned communities.
O’Reilly: It is.
Frankel: A lot of people think of it as a condo development.
O’Reilly: It’s 60 acres, but we very much consider it a master-planned community. It’s just a master-planned …….