First Hawaiian Bank Reaches $10 Billion in Loans

First Hawaiian Bank has announced that they have reached $10 billion in loans for the first time in their company's history, and attribute this to a growing level of consumer confidence and a resurgence in the construction industry. Bob Harrison, the chairman, president and CEO of First Hawaiian, stated, "We're seeing good growth in the lending portfolio, which leads to growth in net interest income. We also saw good expense control, as we have had throughout the year, and we had gains from securities sales (in the bank's investment portfolio)."

Deposits have also grown over the last 12 months to $14.7 billion from $13.6 billion.  Harrison commented, "Deposits are really a reflection of the bank's relationship strategy as we continue to grow and the economy continues to improve here. That's how deposits grow. It's been unusually high, even we're a little surprised at how high the deposit growth has been going. We're seeing that on the consumer side in terms of borrowing and deposit growth. It also has been strong in the construction portfolio. Clearly, we're seeing growth in our construction loans and, secondly, with those people in the construction industry that are working, you're seeing growth and confidence in their own personal lives. Those are generally well-paying jobs."

Source: Honolulu Star Advertiser, 1-23-2015, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Update on Artspace in Kakaako

The Hawaii Community Development Authority has voted 6-0 in favor of issuing the non-profit Artspace to build an eight story building in Kakaako.  Under Artspace's proposal, their building will feature a total of 84 rental lofts that will serve as housing for artists.  Monthly rents will range from $437 to $1,334 per month and will target those households earning between 30 percent to 60 percent of Honolulu's median income ($20,150 for a single person or $40,260 for a family of four on the low end).  "Art" for the Artspace project is defined broadly and can include literature, photography, architecture, singing, dancing, film-making and acting.  Even technicians, administrators and teachers who support art can qualify.  The quality of the art produced will not be a factor in deciding occupancy.  The building should be finished by the end of 2016.

Source: Honolulu Star Advertiser, 1-22-2015, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Hawaii Experiencing a Shortage of Doctors

According to a report issued by the University of Hawaii John A. Burns School of Medicine's Area Health Education Center, Hawaii currently has a shortage of 890 doctors. Furthermore, with almost one-third of the state's doctors reaching retirement age within the next five years, this shortage is expected to increase to as high as 1,500 doctors by 2020.  Things are particularly bad on the neighbor islands, which seems to have a harder time attracting physicians then Oahu.

If someone were to look at the Hawaii medical want ads, things do not appear so bad as there are fewer then 40 positions currently open at larger hospital or medical providers. This is because traditionally a high percentage of physicians would open their own primary care practices in their neighborhoods.  However, many new graduates today prefer not to have the stress and headache of running their own business and prefer to obtain a "job" at a large hospital.  Large hospitals are simply not hiring enough new doctors to fill the needs of the Hawaiian islands.

Source: Honolulu Star Advertiser, 1-20-2015, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Credit and Debit Card Spending Increases by 7.4 Percent During Fourth Quarter of 2014

According to a report issued by First Hawaiian Bank, credit and debit card sales increased by 7.4 percent during the fourth quarter of 2014. This amounts to $763.8 million as compared to the $711 million in the same quarter a year prior.  Bob Harrison, the chairman, president and CEO of First Hawaiian Bank, stated, "The economy continues to grow. Lower energy costs will continue to help the customer because they'll be spending less on electricity. That will give them more disposable income, which will be good for the rest of the economy. This report is a really good reflection of consumer confidence. Construction employment has gone up, and a lot of projects are going up in Honolulu. We see further strength in 2015. For the Japanese visitor, the yen has weakened considerably over the last 12 months, but they're still coming to Hawaii. We're still optimistic for another strong year. I think the strong economy will certainly help the mainland visitors to Hawaii as well." First Hawaiian is the largest bank in Hawaii with $18.1 billion in assets.

Source: Honolulu Star Advertiser, 1-18-2015, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Film and Television Industry Spent $223 Million in Hawaii in 2014

According to Donne Dawson, the Hawaii Film Commissioner, the film and television industry spent a total of $223 million in productions in 2014.  This is a slight decrease from the $228 million that was spent in 2013 or the $245.6 million that was spent in 2012.  Dawson commented, "I don't think there's a way to explain (the drop), really.  We did have a project that was slated for 2014 that pushed to 2015. If it hadn't, the figure would have been significantly higher. These things happen for a variety of reasons. It's the nature of the industry."  Dawson added that she does not anticipate much growth in spending in 2015.

Source: Honolulu Star Advertiser, 1-18-2015, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
Global Executive Realty, LLC
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Waikiki Commercial Properties May Pay Special Tax to Maintain Waikiki Beach

The Honolulu City Council is being presented with bills that would allow the Waikiki district to tax the owners of all commercial properties in Waikiki an additional 7.63 cents per $1,000 of assessed value.  By levying this tax, the Waikiki district hopes to collect approximately $600,000 a year from these commercial properties to help maintain the sand on Waikiki Beach.  The balance of the $1.3 million that it costs to retain sand on Waikiki Beach will be paid for by the state Department of Land and Natural Resources.  According to the DLNR, the beach is eroding at a rate of about one foot per year.  The beach will be need to be replenished every five to ten years to keep up with this loss.

Commercial property owners in Waikiki already pay between 12.5 cents to 50 cents per $1,000 of assessed value into the Waikiki Business Improvement Fund.  This is in addition to their regular property tax bill.  The Waikiki Business Improvement Fund pays for the streetscape maintenance, the "aloha ambassadors" in Waikiki, and overtime hours for the Honolulu Police Department officers.

Source: Honolulu Star Advertiser, 1-18-2015, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
Global Executive Realty, LLC
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University of Hawaii's Cancer Center Will Run Out of Funding in Two Years

The Cancer Center, a research unit of the University of Hawaii at Manoa, will run out of funding in just two years, leaving lawmakers furious at the lack of oversight by the University.  Last year, the Cancer Center ended the year with nearly a $10 million budget deficit and was required to tap into its financial reserves in order to stay afloat.  David Lassner, the university president, admitted to the state House Finance and Senate Ways and Means committees that the university isn't sure what will happen if the reserves are depleted.  Lassner stated, "It is not clear — without support from some source, that Hawaii can maintain a (National Cancer Institute-designated) cancer center."

With declining cigarette tax revenues that pay for cancer research, and the fact that the center's Kakaako facility costs $8 million a year in mortgage payments, has left the Cancer Center in huge financial problems.  Senator Jill Tokuda, the Ways and Means chairwoman, commented, "I think we're in a very serious situation, probably more serious than you realize. Yes, we have a very significant obligation to the health and wellness of the people of the state. But we have a fiduciary responsibility to the state as well. The Legislature is going to want to make sure that we see some sort of very solid and detailed business plan."

Source: Honolulu Star Advertiser, 1-16-2015, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
Global Executive Realty, LLC
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