More than $1.8 billion in private capital has flooded into downtown Honolulu since 2020, funding the most ambitious urban renewal effort in Hawaii’s history. Developers, major corporations, and city officials are betting they can resurrect a struggling business district by converting empty office towers into housing and rebranding the area as “DoHo.”
The stakes are high. Office vacancy rates hit 15.12% by early 2023, up from 12.11% before the pandemic. Walmart, Longs Drugs, and Ross all abandoned their downtown locations. A security guard was bludgeoned to death at Fort Street Mall in 2022. Bank of Hawaii closed its Chinatown branch over safety concerns and hired extra security for remaining locations.
Now, the question facing Honolulu: Can billions in real estate investment and a new Business Improvement District turn around a downtown that’s been losing ground for years?
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Avalon Group Bets Big on Office Conversions
Local developer Avalon Group is leading the charge. The firm has purchased eight properties since 2023, accumulating 1.1 million square feet and control of 1,800 parking spaces across downtown. CEO Christine Camp framed the company’s investment as essential.
“Downtown is too big to fail,” Camp told city officials during testimony for the Business Improvement District. “Without support to focus on cleanliness and safety, it may not succeed.”
Davies Pacific Center, now rebranded as Modea, represents Avalon’s flagship project. The 22-story building at 841 Bishop Street added 352 condominium units with pricing from $400,000 for studios to over $1 million for three-bedroom units. First residents moved in during late 2025.
The former Walmart building on Fort Street will house 100 residential units above the parking structure, with plans for an additional 300-unit tower featuring ground-floor retail. Avalon also purchased Topa Financial Center in December 2024, two 20-story towers totaling 483,776 square feet at Bishop and Queen Streets.
Douglas Emmett converted its Bishop Place tower at 1132 Bishop Street into The Residences at Bishop Place, rental apartments priced between $2,500 and $3,700 monthly. Between 2019 and 2023, Colliers Hawaii projected Oahu’s office inventory could shrink by 1 million square feet, roughly 7.5% of the total market.
Corporate Headquarters Return Downtown
Major employers have moved operations back to the urban core. Hawaii Employers’ Mutual Insurance Company, Hawaiian Host, Mauna Loa, and Hawaii State Federal Credit Union all relocated headquarters downtown. Central Pacific Bank put $40 million into renovating its facilities. Hawaii National Bank opened new offices in the area.
Ben Dookchitra, Avalon’s Chief Financial Officer, compared the transformation to Brooklyn two decades ago. “This place is turning into a 24/7, 365-day-a-year city center,” Dookchitra said.
City Creates Business Improvement District
Mayor Rick Blangiardi signed Bill 51 on October 20, 2025, establishing the Downtown Honolulu Business Improvement District. The legislation expanded the existing Fort Street Mall Special Improvement District to cover 2,088 parcels between Nuuanu Avenue, South Beretania Street, Richards Street, and Nimitz Highway.
The BID operates on a $1.9 million annual budget funded by assessing commercial property owners 0.075% of tax assessed value, about $0.02 per square foot monthly. Residential units are exempt.
Funded services include:
- Seven security personnel patrolling early morning through late night
- Two-person pressure washing crews cleaning public spaces five days weekly
- Landscaping and beautification projects
- Uniformed ambassadors
Councilmember Tyler Dos Santos-Tam, who represents downtown, said the measure works alongside streamlined office-to-residential conversion rules and permanent outdoor dining policies. “I hope this is going to be an inflection point,” Dos Santos-Tam said.
Some property owners opposed the assessments. Initial testimony revealed concerns about inadequate outreach and unexpected costs running into thousands annually for larger properties. The ordinance includes provisions allowing proceedings to halt if owners of 51% of affected land file written protests.
Community Groups Launch Weekly Events
Nonprofit organization Activate DoHo, led by Chairman Westley Starnes, runs weekly community programming. The DoHo Run Club meets Thursdays at 5:30 p.m. at Fort Street Mall for a 1.5-mile route followed by happy hour at downtown establishments. A yoga club meets Mondays at 5:30 p.m. on the sixth-floor garden deck at Topa Financial Center for $15 per session.
Monthly DoHo Night Markets feature local vendors, student performances, food trucks, and family activities. “We want to show that downtown isn’t all what you hear,” Starnes said. “It really is a good place and it can be a safe place.”
The run club started in 2024 with young professionals who wanted to activate the area. Interest grew steadily, with participants consistently showing up week after week.
Mixed Results for New Businesses
Not every venture has succeeded. David Choi invested $2 million opening 88 Pal Pal Super Market in 2023 near the former Longs Drugs location, thinking the bus stop would bring foot traffic. The store failed within two years.
“There’s nobody here all weekend, sometimes for three-day weekends,” Choi said before his going-out-of-business sale in early 2025. “Or at night after 5 p.m.”
Paris Baguette opened on Bishop Street in February 2024 and posted higher opening-day sales than any other Paris Baguette location that had launched in the United States, according to Mark Bratton, senior vice president for Colliers International.
Sandra Pohl, executive director of the Downtown Art Center, told city officials that customers stopped visiting downtown businesses because of safety concerns and deteriorating conditions. She described “pervasive stench and filth” throughout the area in testimony supporting the Business Improvement District.
Housing Crisis Creates Unlikely Opportunities
Honolulu’s median housing cost runs 2.7 times the national average, creating demand even for less-than-ideal living situations. One building at 1136 Union Mall operated for months in 2025 as unlicensed co-living space without proper kitchens, air conditioning, or ventilation. Dozens lived there despite city complaints about health and safety violations.
The situation, which involved court battles over unpaid rent and utility shutoffs, highlighted both the housing shortage and the challenges facing downtown properties. The building’s operator used “DoHo Suites” branding but had no connection to the broader revitalization efforts.
What Comes Next
Christine Camp told the Honolulu Star-Advertiser she expects at least 15 new projects valued at approximately $1 billion to deliver over the next five to seven years. The timeline reflects coordinated planning among multiple property owners and developers who started meeting in May 2024 to discuss downtown’s future.
Chris Fong, senior investment associate at Tradewind Capital and a Downtown Honolulu BID volunteer, said stakeholders agreed the area faced serious problems. “The future of downtown was in jeopardy because of increased homelessness, crime, and retail vacancies,” Fong said.
Bratton noted downtown Honolulu was thriving in 2018 and 2019 before the pandemic dealt a heavy blow, similar to what happened in San Francisco and other major cities. He credited local developers for taking on financial risk when institutional investors stayed away.
Downtown Honolulu’s transformation hinges on converting office workers into residents, adding security and maintenance through the Business Improvement District, and hoping enough businesses follow to create the 24-hour activity that makes urban neighborhoods work. The $1.8 billion investment represents a major commitment, but whether money alone can overcome safety concerns, change decades of commuter patterns, and build a genuine residential community downtown remains uncertain. The next few years will determine if DoHo becomes a model for urban renewal or a cautionary tale about the limits of real estate development.
