Honolulu’s ship-accessible harborfront setting secured its place in history, first as a port for whaling and sugar and pineapple plantations, and then in the 1920s when those industries gave way to tourism.
And Honolulu’s most sought-after area for luxury beachfront estates and harbor views, Kahala/Diamond Head, has long been regarded as a sacred place by native Hawaiians. The two neighborhoods are often grouped together based on proximity—Diamond Head Road turns into Kahala Avenue—and because they share proximity to landmarks, amenities, shopping, destinations and restaurants. The prominent natural landmark of the area is the Diamond Head crater, a dramatic-looking volcanic tuff cone.
"This always has been the heart of Hawaii’s luxury home market," said Rachel Ross of Berkshire Hathaway of Hawaii. "It has stood the test of time as a destination for both kama’aina (residents born in Hawaii) and newcomers alike, and is known for its estates, long white-sand beach, privacy and timeless elegance. While there are many full-time Honolulu residents, the neighborhood has long been the premiere destination for second-home owners as well."
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Boundaries
Patti Nakagawa, senior vice president of Coldwell Banker Pacific Properties, defined the boundaries of both areas. Kahala is marked by Waialae Avenue to the north and Kahala Avenue to the south.The eastern boundary is Kealaolu Avenue, adjacent to Waialae Country Club and Golf Course, and the west is marked by Aukai Avenue, Ahakea Street, Elepaio Street, Hunakai Street. Diamond Head is defined by Monsarrat Avenue and Diamond Head Road to the north, Diamond Head Road to the south and east and Paki Avenue and Monsarrat Avenue to the west.
Price Range
There is a broad range, from $1.5 million to $25 million, for a single-family home, said Sachi Braden, president of Sachi Hawaii Pacific Century Properties. Offering a breakdown of price and purchaser profile, Ms. Braden said: "Homes in the more affordable range of this high-end market, between $1.5 million and $3 million, are typically owned and purchased by local buyers." Over the last two years, though, this market has slowed, she said "due to increased competition from luxury condominiums in the heart of urban Honolulu." But in the last six months or so, things have seemed to have bounced back, she said, with homes staying on the market for less time. "The market has bounced back partly because of the way buyers view the global economy, and partly because of the decreased competition from neighboring Kaka`ako's luxury condominium developments," Ms. Braden said. "As these developments have less inventory (projects are coming to completion, fewer units are available), buyers no longer have the luxury condominiums as an option versus the single-family homes in Kahala and Diamond Head."
On the other end of the spectrum, "properties priced from $3 million to $6 million tend to attract offshore buyers, and are usually part-time homes or investment purchases," Ms. Braden said. "The high-end market purchases, $10 million and above, range from Silicon Valley entrepreneurs to savvy world-travelers."
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Housing Stock
Expect large estates with private pools and many with secluded beachfront access, spectacular ocean views and gorgeous grounds with lush tropical foliage. "The neighborhood has maintained its prestige and the style of homes range from European estates with formal dining rooms and separate quarters for household staff, to more casual and beachy properties appealing to those who enjoy the surfing and beach amenities," said Frankie Anderson, a realtor with Coldwell Banker Pacific Properties.
Ms. Braden noted that custom-designed homes are created for ideal indoor and outdoor living, and best described as Modern-Mediterranean or Modern-Hawaiiana.
What Makes it Unique
"Kahala/Diamond Head is the prestigious luxury neighborhood to live in," said Ms. Braden.
"In Kahala, you’re never far from various hidden beaches along Kahala Avenue and neighboring streets. You’re also centrally located to East Honolulu, where you can easily travel 10 minutes east or west to visit favored destinations for dining, shopping and entertainment," she said.
Luxury amenities
The area offers Hawaii’s tropical lifestyle at your fingertips — from hidden beaches and marine wildlife to internationally regarded golf resorts, including the Waialae Country Club, a private club and golf course—that hosts the Sony Open each year—and has a waitlist for prospective members, Ms. Nakagawa said. "The Kahala Hotel and Resort is conveniently situated next door," she added.
As for the surrounding area, "Waikiki is just a 10-minute drive from anywhere in Kahala/Diamond Head, with access to Kapiolani Park, the Waikiki Zoo and Aquarium, restaurants, bars, water sports, surfing and more," Ms. Braden said. "Up and coming Kakaako in urban Honolulu is a short 10-15 minute drive from anywhere in Kahala, where you can enjoy the world’s largest outdoor shopping mall, Ala Moana Center, and directly across the street, Ala Moana Beach Park."
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Locals can be found dining out on upscale Italian at Arancino at the Kahala, innovative American cuisine at Town, and sitting outside on the breezy terrace at the Plumeria Beach House, which is known for fresh seafood.
As for area schools, top choices include Sacred Hearts Academy for girls (pre-kindergarten through 12), President Barack Obama’s alma mater Punahou School (kindergarten through 12), and La Pietra private school for girls (grades six through 12), which is set on the scenic grounds of the former Dillingham estate.
Who Lives There
"As with everywhere in Hawaii, Kahala/Diamond Head is an international melting pot, consisting of a local who’s who of developers, doctors, and lawyers, to mainland’s tech entrepreneurs and investors, to off-shore businessmen and manufacturers," Ms. Braden said.
Notable Residents
"Notable residents have included Liza Minelli, Carol Burnett, Barbara Cox Anthony, Don Ho, Duke Kahanamoku, and Chris Hemmeter to name a few. Celebrities flocked to this neighborhood to rent private estates and enjoy lavish parties—including the Kennedys, the Reagans, Judy Garland, Johnny Cash, Tony Orlando, Jimi Hendrix, Janis Joplin," Ms. Anderson said.
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"Jim Nabors, Clare Boothe Luce lived here, and the private residence of Doris Duke, known as Shangri La, is now an Islamic Art and Culture Center, located in Kahala’s Black Point," Ms. Ross added.
Actors Alex O'Loughlin ("Hawaii Five-O," "The Back-up Plan") and Daniel Dae Kim ("Hawaii Five-O," "Lost"), and eBay founder Pierre Omidyar currently have homes in the area.
Outlook
New developments have helped to expand this in-demand market, particularly in Kahala. "Kahala is experiencing a revitalization. In 2013, local real estate company Alexander & Baldwin bought 31 properties in Kahala, many of which were highly desirable oceanfront parcels, from Japanese billionaire Genshiro Kawamoto. Kawamoto had let the properties fall into disrepair, negatively impacting the feel of the exclusive community," Ms. Ross said.
"The developer has resold the majority of the homes and parcels, improving some and razing those that couldn’t be saved, and the result is a refreshed Kahala. For the first time in years, there are vacant parcels available, both waterfront and along Kahala Avenue."
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And, Ms. Ross said, "a new concept will bring six luxury homes on one oceanfront lot to market soon that will offer a unique opportunity to experience the beauty of old Hawaii and old Kahala, at a level of luxury not previously found."
Currently, the market in Kahala/Diamond Head is pricing upward, as it typically does during the summer months with seasonal "retreat" buyers visiting. Prices have been rising year over year consistently across the island, Ms. Braden reported.