The Honolulu Authority for Rapid Transportation, which oversees the rail project, is requesting that the Honolulu City Council allow them to borrow hundreds of millions of dollars in bonds leveraged against the city's general fund to help pay for the project. While this had always been a part of the financial plan to build the rail project, recent news that the project faces a $500 million to $700 million budget shortfall has left City Council members uneasy if the rail project will ever be able to pay them back. Ann Kobayashi, the city Budget Chairwoman, stated, "I've been told so many things, and many of them untrue, and there's been so many changes so I just want to make sure. We're asking every taxpayer in our city and county to be co-signers of this loan."
Rail official have been reluctant to provide even a general estimate or range of how much they think the project will need to borrow over the total course of construction. Councilman Ron Menor questioned, "When can we get more specific information? What assurances or safeguards are there that the city would not eventually be put in a situation in which real property tax revenues are required to pay back the loans instead?"
The City Council plans to delay any decisions until at least February.
The Institute of Human Services announced that they have experienced initial success with their full-time homeless outreach program in Waikiki, and have already helped 63 homeless people into shelter or housing since they started in November 3, 2014. The program is funded through a joint effort by the city's Housing First program as well as financial support from the Hawaii Lodging and Tourism Association. Connie Mitchel, the executive director of IHS, stated that the program hopes to serve 300 homeless people during its first year. As a point of reference, during the 2014 Statewide Homeless Point-in-Time Count, it was recorded that there were 541 homeless people in Waikiki in January 2014, but IHS believes that the actual number is slightly higher.
The Hilton Hawaiian Village plans to host a fundraising concert at the end of April to raise at least $1 million for the Institute of Human Services to continue its work to reduce the homeless population in Waikiki. Jerry Gibson, the area vice president for Hilton Hawaii, commented, "We want the community to line up behind us for IHS so that we can put a real big effort into giving them as much as we can so that they can have the tools to do their job to end homelessness." Honolulu Mayor Kirk Caldwell stated, "What's taking place in Waikiki is a testament to what can happen when the public, private and nonprofit sectors work together, and we hope to continue this collaborative approach."
Rick Egged, the president of the Waikiki Improvement Association, added, "Frankly, I agree with those that say the problem is not solved, but I believe that they've made fantastic progress. The fact that we are on the right track shows that we can get results with the money that's been raised. The outreach and services that are happening now weren't available a year ago."
Matson Inc. has announced that it will reduce its fuel surcharge from 35.5 percent to 31.5 percent due to the fact that fuel prices have continued to drop. The most recent reduction will go into effect on January 18, 2015, a little less than a month from the last price reduction of 2 percentage points on December 21, 2014. Dave Hopes, Matson's senior vice president for ocean services, stated, "We are pleased to be able to make another downward adjustment to our fuel surcharge, which for most customers represents a reduction in shipping costs ranging from $80 to $140 per container. With this latest reduction, our fuel surcharge for those services will have dropped 11 percentage points since Nov. 2. We continue to be encouraged by the recent moderation in bunker fuel prices and remain focused on diligently exploring ways in which we can maximize fuel efficiency for our fleet."
Source: Honolulu Star Advertiser, 1-13-2015, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
Global Executive Realty, LLC
www.myhawaiihomesearch.com
www.myhawaiicondo.com
www.myhawaiidreamhome.com
The Hawaii Tourism Authority and Pacific Links Hawaii have announced that they are working together to attempt to attract more high-spending Chinese golfers to the Hawaiian Islands. Micah Kane, the chief operating officer of Pacific Links Hawaii commented, "Year-to-date, we've hosted about 2,500 rounds of golf for Chinese members. Ideally, we'd like to see the partnership grow so that we can host 200 to 300 Chinese players monthly." Chinese golfers that come to Hawaii spend more than $550 per day in hotel stays, activities, and travel expenses.
David Uchiyama, the vice president of brand management for HTA, added, "We've partnered with Hyundai to develop the Korean golf market and with Sony to develop Japan, but this is the first time that we've participated in a public-private partnership to bring more Chinese golfers to Hawaii. In general we are doing very, very well in China, and we'll continue to improve our numbers. Golf is becoming a mainstream sport in China. If we can create enough demand, we'll get more carrier frequency, and that will help build the market even more."
Liwei Kimura, the director of business development for Starwood's Hawaii Region, Greater China & South East Asia Markets, commented, "We commend HTA and Pacific Links' leadership in this niche market development as golf is a fast-emerging activity in China, not only because it is viewed as a healthy and enjoyable sport, but also because people are attracted to it as a luxury lifestyle and a statement of social status. Hawaii can benefit by targeting these higher-spending, luxury leisure travelers who can bring us more economic benefit with less impact on our natural resources. Promotion of golf travel is one of the best ways to maximize Hawaii's competitive advantages while highlighting its world-class courses to target the Chinese."
In 2013, the City and County of Honolulu created the Residential "A" Tax Classification, which significantly increased the property taxes for all Oahu residential properties valued at $1 million or more, where the owner does not have a homeowner's exemption. Residential A owners now pay $6 per every $1,000 of assessed value while those with homeowner exemptions pay just $3.50 per $1,000 of assessed value. There are approximately 8,557 properties on Oahu that have been designated as Residential A.
Opponents of the tax law argue that it is not ethical, rational, fair or legal to create tax classes based upon assessed value, when they are all built for residential use. Previously, property tax classes were based on use, for example residential, hotel/resort, agricultural, or business. As property values increase, there will be more and more homeowners who may be pushed into Residential A class. There is now discussion about challenging this law in court.
Park Lane Ala Moana has announced that they have begun their owner occupant sales. Located on ocean side of Ala Moana Center, the property will consist of seven six-story buildings with a total of 215 units, ranging from 850 sq ft one-bedroom residents to 6,000 sq ft five bedroom penthouses. Prices for the one-bedrooms start at $1.19 million and will go up to $28 million for a penthouse unit. Half of the units will be restricted to owner-occupants while the others can be purchased by investors. The investor sales began in November and most of those units have been sold. The first phase of the project is expected to be completed late 2016 and the final phase by the end of 2017.
Source: Realtors Association of Maui
Single Family Home Sales Data for the Island of Maui
December 2014 - 63 Houses Sold - $565,000 Median Price
December 2013 - 78 Houses Sold - $512,500 Median Price
Condominium Sales Data for the Island of Maui
December 2014 - 122 Condos Sold - $387,500 Median Price
December 2013 - 120 Condos Sold - $365,000 Median Price
