When former HBO chief executive Michael Fuchs sought to build a home on the Big Island several years ago, the entertainment industry pioneer had no idea his pursuit would give rise to an entire residential community.

But Fuchs' vacation-home quest has begun to result in sales and construction of 59 million-dollar duplex homes and single-family house lots carved from an old lava flow at Mauna Lani Resort.

The Fuchs project, called Ke Kailani, has become the highest-priced and lowest-density residential subdivision at Mauna Lani, and one of the last that will fill out the Kohala Coast resort when completed in about two years.

Fuchs has so far sold roughly $50 million worth of lots and duplex villas through Ke Kailani Development LLC.

The sales represent 15 of the lots and duplexes, or a quarter of the project comprising 39 lots and 20 duplexes.

Ten lots sold for $1.5 million to $8.5 million each, and another five duplexes sold for $3.4 million to $4.3 million, according to Will Beaton, a local real-estate development veteran serving as chief executive of Ke Kailani Development.

"It's exceeding our expectations at this stage of the project," Beaton said. "We're thrilled."

SALES SETTING RECORD

Ke Kailani is part of the hottest segment of Hawai'i's booming new-home development market, homes within vacation resorts, where purchases are being driven by wealthy second-home buyers, primarily from the Mainland.

According to local market researcher Ricky Cassiday, sales of homes at Hawai'i resorts this year are on pace to shatter last year's $2.7 billion record, which was $400 million more than 2003.

Other ongoing residential subdivisions at Mauna Lani include projects by local developers Maryl Group, Stanford Carr Development, Curtis DeWesse and a joint venture of Alexander & Baldwin Inc. and Canada-based Brookfield Homes.

A PLACE IN THE SUN

Fuchs, 59, who headed HBO for more than a decade until 1995 and is chairman of online automobile marketer and seller Autobytel Inc., didn't set out to become a large-scale real-estate developer in Hawai'i.

Beaton said Fuchs was shopping for land on the Big Island on which to build a home for himself, but was attracted to a small piece of coastline at Mauna Lani. The property was the resort's last undeveloped oceanfront land, but was part of a 65-acre parcel stretching alongside three golf fairways abutting the neighboring Mauna Kea Resort.

"Sixty-five acres is a lot of land, and an expensive piece of land," Beaton said.

According to property records, Fuchs paid $15.5 million for the parcel in June 2002. Beaton began working for Fuchs in late 2003 and retained local design firm Group 70 International to develop a master plan.

Fuchs, who is financing the more than $100 million development cost of roads, infrastructure and homes, retained one of four oceanfront lots at Ke Kailani and intends to build his envisioned residence.

Under zoning at the resort, the property could have been developed with more than 200 homes. Beaton said Fuchs was subsequently entitled to build 120 units, but decided to scale that back.

In a statement, Fuchs said he wanted to tread lightly on the land and build something special. "For me, this is really a legacy project that I want to look back on and be proud of," he said. "I'm not a mainstream developer trying to maximize my profits."

LOW DENSITY, BIG LOTS

Ke Kailani lots range from from a half-acre to 1.5 acres. Duplex villas are bigger than 3,300 square feet. "You don't get the sense that you're part of a duplex," said Francis Oda, Group 70 chairman.

Amenities include a 5.5-acre mauka park with a freshwater pond, pools, hula mound, jogging trail, and courts for basketball, tennis and sand volleyball. A second park is designed with a saltwater pool overlooking the ocean, outdoor entertainment pavilions, kitchen and whirlpool spas.

Cassiday said it has become a trend for developers concentrating on the uppermost end of the luxury home market to build less-dense communities that maximize open space, amenities and views commanding higher prices.

Beaton said buyers have been mostly independent working entrepreneurs from the West Coast and some retirees. Most of the buyers also either already own property at Mauna Lani or are repeat visitors to the resort, he said.

Fuchs and his team plan to sell the remaining inventory as construction progresses. Grading work for several lots is complete. The next phase is to install utilities and complete the remaining lot preparation by September 2006. Construction of the duplex villas is anticipated to begin in December and be completed by August 2007.

Reach Andrew Gomes at agomes@honoluluadvertiser.com.