Judge Halts Construction for 801 South Street Building B

Just days after developer Downtown Capital LLC announced that all 410 units in its second tower, Building B, of the 801 South Street project had been sold, Circuit Court Judge Karl Sakamoto ruled that all work must stop due to the fact that two state agencies failed to follow state laws protecting historic places and burials. Sakamoto's verbal decision was in response to a lawsuit that was filed in March 2014 by the owners of the Royal Capitol Plaza, a neighboring building, whose views would be significantly impacted by the creation of Building B. Carl Varady, the attorney for the plaintiff, stated that he believes that Sakamoto will issue a written order that would invalidate the Hawaii Community Development Authority's permit for 801 South B.  If this happens, the HCDA would be required to hold new public hearings and issue a new decision for the project to obtain approval.

Source: Honolulu Star Advertiser, 5-31-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Hawaii Tourism Numbers Down Again in April 2014

According to a report released by the Hawaii Tourism Authority, the number visitors to the state of Hawaii decreased by 0.7 percent in April 2014 and collectively spent 2.2 percent less than they did during the same month a year prior. While the Hawaii Tourism Authority assures the public that the tourism industry is doing well as a whole, it is definitely not doing as well as it had done over the past two years, where records for both arrivals and spending were set.  Mike McCartney, the President and CEO for the Hawaii Tourism Industry, stated, "The HTA anticipates a continued slowdown through the second quarter of 2014, a traditionally slower travel period for the state."

According to McCartney, the decrease can be attributed to a decline in Hawaii's cruise ship industry, growing competition from other vacation destinations, and the strengthening dollar, which means that international visitors are able to spend less while they are here.  The Hawaii Tourism Authority hopes to start diversifying its international markets to places like China, South Korea, Taiwan, Latin America, Australia and New Zealand. McCartney added, "Developing these newer markets creates opportunities for attracting first-time, higher-spending visitors to Hawaii. Through the strategic and collective efforts of our industry, marketing and other stakeholder partners, we will continue to work together to balance and strengthen Hawaii's tourism economy."

Source: Honolulu Star Advertiser, 5-30-2014, www.staradvertiser.com
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Bill Proposed To Divert Road Paving Money to Housing for Homeless

City Council Chairman Ernie Martin is proposing a new bill which would take away $32 million from money currently set aside for repaving roads around Honolulu, and put it towards building permanent and temporary housing for the city's homeless population.  This $32 million would be in addition to the $18.9 million that has already been allocated from the city's Affordable Housing Fund for the homeless and others who are in need of shelter.  Martin noted that this additional $32 million would have a special provision to help "families with children" first.

Ember Shin, the City Managing Director, stated that the Mayor's office supports the concept spending more money to fund homelessness programs, but does not like the idea of diverting money from road repairs. Martin argues that $100 million is more than sufficient to continue the city's street rehabilitation program.

Source: Honolulu Star Advertiser, 5-30-2014, www.staradvertiser.com
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Ka Makana Alii Mall Update

DeBartolo Development LLC, the developer for the Ka Makana Alii Mall which is being built in Kapolei, has announced that they have signed Macy's to be one of their anchor tenants. The $500 million Ka Makana Alii project will have over 100 shopping, dinning and entertainment-related tenants as well as two hotels and office space when completed. Edward Kobel, the President and COO of DeBartolo Development, stated, "Demand for leasing space at Ka Makana Alii has been overwhelming with over 80 percent of space either in lease or active negotiations. We are confident that the addition of Macy's will only heighten interest from local and national retailers.

Source: Honolulu Star Advertiser, 5-30-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Six More Residential Towers in Kakaako Seeking Permits By End of Year

Developers are requesting approval from the Honolulu City Council and the Hawaii Community Development Authority to create a total of six new residential towers in Kakaako.  Howard Hughes Corp is asking to build a total of four new towers; two which would replace most of the Ward Warehouse along Ala Moana Boulevard, one which would be west of the Ward Entertainment Center theater, and the final tower would be next to the recently announced Whole Foods, just north of the theater.  Kamehameha Schools is working with local development firm The Kobayashi Group to build a 265-unit tower on a 3.5-acre site on Ala Moana Boulevard, currently occupied by Cutter Nissan.  The final tower (6th) would be built by SamKoo Development Company and would be located at 1391 Kapiolani Blvd, next to Ala Moana Center.  This tower would be right next to the Ala Moana rail station terminal.

Real estate experts believe that the reason why developers are pushing to secure approval to build so quickly is because this is an election year.

Source: Honolulu Star Advertiser, 5-29-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Live Work Play Aiea Update

The Robertson Properties Group has received approval from the City and County of Honolulu to create the Live Work Play Aiea project on the site of the former Kam Drive In in Aiea.  The $766 million project would include as many as 1,500 new residential units, out of which 30 percent must be affordable housing units under federal housing guidelines. What makes the project exceptionally interesting is that it will be Oahu's first transit-oriented project, since it will be created along the Honolulu Rail Project transit line, and will surround one of the rail project rail stations.  Breene Harimoto, the City Councilman  who represents the Aiea area, stated, "This will allow us not only to densify the urban core but really, truly, it will help us to maintain the country as country and to really preserve the outlying areas. This is the only way for us to go, densify the urban core."

The first phase of the Live Work Play Aiea is expected to be completed at the end of 2016.

Source: Honolulu Star Advertiser, 5-29-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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801 South Street - Building B Has Sold Old

Downtown Capital LLC has announced that the second tower, Building B, of the 801 South Street has sold out. The developer stated that all 410 units have been purchased by local residents and 90 percent of them have stated that they intend to live in their unit.  801 South Street is a "work force" housing project, and requires that at least 75 percent of the units are sold to buyers who earn no more than 140 percent of Honolulu's median annual income.  This equates to $84,574 for a single person, $96,656 for a couple or $120,720 for a family of four.

Units in Building B ranged from $352,000 for a one-bedroom unit to $699,000 for a three-bedroom unit. Construction of the second tower is expected to begin by the end of this year and will take about two year to complete.  Building A is already under construction.

Source: Honolulu Star Advertiser, 5-29-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Air Canada to Begin Non-Stop Flight From Toronto to Honolulu

Air Canada has announced that they will be offering twice-weekly service between Toronto and Honolulu beginning on November 26, 2014 on their Air Canada Rouge airline.  Air Canada Rouge was formed on July 1, 2013 to help Air Canada compete in the growing leisure travel market.  Benjamin Smith, the Executive Vice President and COO of Air Canada stated, "Hawaii has long been a very popular vacation destination for Canadians from coast to coast."

Source: Honolulu Star Advertiser, 5-28-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Billionaire Nicholas Woodman Purchases Two Properties on North Shore of Oahu

Nicolas Woodman, the creator and founder of GoPro Inc., has just purchased two properties in the Sunset Beach Area on the North Shore of Oahu.  The two properties are actually adjacent to one another.  The first property was a 31,000 sq ft oceanfront lot and sold for $8.5 million. The second property, which sold for $925,000, was set back from the ocean and included a 66-year old house in poor condition.  Richard Sterman, the principal broker for Sterman Realty, which is located in Haleiwa on the North Shore, believes that these purchases are wonderful news for the community, which has only recently been attracting high-net worth individuals into the aera. Sterman stated, "The North Shore has new upper-end buyers coming in, discovering the North Shore and choosing to make it their home or second home."

Source: Honolulu Star Advertiser, 5-28-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Oahu's Residential Electrical Rates Decrease Slightly in May 2014

According to a report issued by the Hawaiian Electric Company, residents paid 33.5 center per kilowatt-hour in May 2014. This is a slight decrease from the 33.8 cents per kilowatt-hour that HECO charged in April. However, the neighbor islands saw increases in their electrical rates. The Maui Electric Company raised their rates to 37.3 cents per kilowatt-hour, up from 36.5 cents. Hawaii island (Big Island) residents paid 39.8 cents per kilowatt hour, up from 39.1 cents. Kauai residents paid the most at 42.7 cents per kilowatt-hour, up from 41.9 cents the previous month.

Source: Honolulu Star Advertiser, 5-27-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Mayor Wants to Increase Property Tax Rates for Hotel and Resort Owners

Mayor Kirk Caldwell has stated that he would like to increase the property tax rate for hotel and resort owners in an effort to raise money to address the homeless situation in Waikiki.  Under Caldwell's proposal, hotel and resort owners would pay $13.40 per $1,000 of assessed value, a slight increase from the current amount of $12.40 that is currently being paid. The increase would generate an additional $4.1 million, out of which $2 million would go to the Wai­kiki Business Improvement District for rental vouchers that could give shelter to homeless individuals and families.  Furthermore, $900,000 would go to the district for grants that provide outreach and other services for Waikiki's homeless and $750,000 would go to paying for the removal of items left on the sidewalks. Finally, $250,000 would go to increasing the frequency of sidewalk, bathroom and public area cleanings, and $200,000 would go to increasing security patrols. 

Source: Honolulu Star Advertiser, 5-26-2014, www.staradvertiser.com
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Ward Village to Host Free Outdoor Movies

The Howard Hughes Corp has partnered with the Hawaii International Film Festival and Consolidated Theaters to host free outdoor movies at their Ward Village complex in Kakaako. The first movie, Bella Vita, will be hosted on June 12, 2014 and more will be hosted on the second Thursday of each month. Jason Baffa, the filmmaker, will attend the 6 p.m. screening and will answer questions that visitors may have. David Striph, the senior vice president for Howard Hughes in Hawaii, stated, "Our thought process was really that it would be a good community event, a way to bring people in to experience Ward Village, and a way to give back to the community."

The movies will be shown at a newly redeveloped courtyard at IBM Building. Katie Ka'anapu, the senior marketing manger for Howard Hughes, stated, "We look forward to sharing these fantastic films with our local community, and invite everyone to join us for what we believe will be a fulfilling cultural and educational entertainment experience for all." Tickets to the free event can be obtained online at the Ward Village Courtyard Cinema website.

Source: Honolulu Star Advertiser, 5-26-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Governor Abercrombie Speaks at Democratic Party's State Convention

Governor Neil Abercombie spoke at the Democratic Party's state convention this past weekend and assured his party that he was the right governor for the job.  Abercrombie is hoping to get reelected as governor for another term and stated that since taking office four years ago he has helped turn Hawaii's economy around.  Governor Abercrombie stated, "So I can report to you that we have restored Hawaii's fiscal health. We're contributing to the economic recovery by focusing on growth and sustainability. We're transforming government by implementing measures to move government into the 21st century efficiently and effectively to serve the public. We're investing in education and skills and the well-being of Hawaii's people. And that means we have the right values, we have the right priorities, and I can report to you, you've got the right governor."

Governor Abercrombie's primary opponent in the Democratic Party is state senator David Ige.  Ige is running on a platform of restoring trust and faith in the state government.  Ige commented, "It's amazing to me in this campaign how I get blamed for everything that doesn't happen, but (Abercrombie) takes the credit for everything that does happen. You can't have it both ways.

Source: Honolulu Star Advertiser, 5-25-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Over Half of the Top 20 Beach Housing Markets Are in Hawaii

According to a report issued by RealtyTrac, 11 of the top 20 beach housing markets in the United States are located in Hawaii.  The California-based research company conducted their studies based upon the average temperature, percentage of sunny days, percentage of days with good air quality and crime rates.  The top 20 markets were then selected provided that they had a median value of below $1 million.  Daren Blomquist, the vice president at RealtyTrac, explained, "Buying near the beach is one of the best ways to ensure a property will appreciate in value. Whether buying for retirement, a vacation home or a primary residence, homes located in quality beach towns benefit from virtually unlimited demand and a finite supply of land to build on."

Ranking third on the list was Waianae, located on the Leeward Coast of Oahu.  Waianae has an average temperature of 76 degrees, 74 percent sunny days, 100 percent days with good air quality, and a crime grade of a B.  It also has a relatively low median home value at $309,328. The other Hawaii beach housing markets to make it in the top 20 were Wailuku (Oahu) at fourth place, Kahului (Maui) seventh place, Ewa Beach (Oahu) at eighth place, Kihei (Maui) at ninth place, Waipahu (Oahu) at tenth place, Lahaina (Maui) at 12th place, Honolulu (Oahu) at 13th place, Pearl City (Oahu) at 14th place, Kaneohe (Oahu) at 15th place, and Kailua at 18th place. 

Source: Honolulu Star Advertiser, 5-24-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Governor Signs New Minimum Wage Into Law

Governor Neil Abercrombie has signed a new law that will gradually increase the minimum wage in Hawaii to $10.10 per hour by January 2018.  Under the law, the wage will increase to $7.75 in January 2015, to $8.50 in January 2016, to $9.25 in January 2017 and to $10.10 in January 2018. Hawaii's minimum wage is currently $7.25 per hour and has been that way since 2007.  The tip credit will also increase to 50 cents per hour in January 2015 and to 75 cents per hour in January 2016, but businesses will only be able to deduct the tip credit from workers who earn at least $7 per hour above the minimum wage.

Source: Honolulu Star Advertiser, 5-24-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Hawaii Pacific University Forced to Cut Faculty Positions and Reduce Employee Benefits

Over the past year, Hawaii Pacific University has seen a 10 percent decrease in their enrollment, from 7,463 students to approximately 6,700 students for this coming fall.  While this decrease is similar to that seen in private colleges around the country, this decreased commission will mean that Hawaii Pacific University will have to reduce the number of faculty positions and reduce employee benefits. Tentatively, 18 of HPU's 250 full-time faculty members will not have their contracts renewed. There will also be a reduction in the employer contribution to retirement plans and decrease in tuition waiver benefits for full-time employees and their dependents.  Janet Kloenhamer, the executive vice president for administration and general council, stated, "Guided by our strategic plan, HPU is forging a path to deliver the highest quality of education, with increased services, programming and spaces, both efficiently and cost-effectively. Unlike public universities that receive state funding, HPU's operating budget is largely from tuition dollars and private gifts. The realignment of existing resources is necessary to make long-term investments to ensure that HPU becomes an even better, stronger university."

According to their IRS tax filing, Hawaii Pacific University earned $101.6 million in revenue, out of which $96.5 million came from tuition and fees. HPU also provided about $20 million a year in scholarships. Full-time undergraduate tuition for the 2014-2015 school year is $20,930.

Source: Honolulu Star Advertiser, 5-24-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Neighbor Islands Poised for Economic Growth

According to a report released by the University of Hawaii Economic Research Organization, the neighbor islands are poised for solid economic growth over the next two years. Below is a breakdown per county according to UHERO predictions:

Honolulu County
2014 - +0.3% visitor arrivals, +1.2% payroll jobs, +2.1% personal income
2015 - +0.3% visitor arrivals, +1.6% payroll jobs, +3.1% personal income

Hawaii (Big Island) County
2014 - +1.2% visitor arrivals, +1.8% payroll jobs, +3.5% personal income
2015 - +3.1% visitor arrivals, +2.2% payroll jobs, +4.1% personal income

Maui County
2014 - +2.2% visitor arrivals, +2.1% payroll jobs, +3.6% personal income
2015 - +2.9% visitor arrivals, +2.2% payroll jobs, +4.1% personal income

Kauai County
2014 - +1.7% visitor arrivals, +2.0% payroll jobs, +3.5% personal income
2015 - +3.6% visitor arrivals, +1.6% payroll jobs, +3.6% personal income

Source: Honolulu Star Advertiser, 5-23-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Coco Palms Resort of Kauai to Reopen in 2017 Under Hyatt Management

In 1992, the Coco Palms Resort on the island of Kauai was forced to close their doors due to the devastation caused by Hurricane Iniki.  Since then, several investment groups had expressed interest in redeveloping the property, but for various reasons, none were able to do so.  In 2013, a locat investment group calling themselves the Coco Palms Hui LLC purchased the property for $12.3 million and a just this past week announced that they will be reopening the 363-room resort to guests in 2017 under the management of Hyatt. Tyler Greene, the manager of Coco Palms Hui LLC, stated, "Our endeavor to revitalize the grounds and rebuild, all the while preserving the soul of the iconic resort, is an ambitious project. We are delighted to join forces with Hyatt, another Hawaiian icon of hospitality that has been delivering authentic hospitality to guests for over 30 years in Hawaii."

Bernard Carvalho Jr., the mayor of Kauai, added, "The redevelopment of The Coco Palms Resort is not just a feel-good story. The investment of time, money and labor to revitalize the resort grounds and reignite the spirit of this legendary hotel is great news for our community. Hyatt's brand presence in our community with Grand Hyatt Kauai Resort & Spa is exemplary and we look forward to Hyatt's contributions as our community continues to grow in importance as a tourist destination."

Source: Honolulu Star Advertiser, 5-22-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Hawaii to Host World Conservation Congress in 2016

The International Union for Conservation of Nature has announced that the state of Hawaii will be hosting the World Conservation Congress in 2016.  The event, which will take place in Honolulu from September 1 to September 10, 2016, is expected to bring in about 8,000 political and business leaders from over 160 countries, and they will be meeting to discuss the world's most pressing environmental and developmental challenges.  The state of Hawaii will be held responsible for paying for about half of the events budget, or just of $10 million of the $20 million total anticipated costs.  Mark McGuffie, the managing director of Enterprise Honolulu, noted, "This is the Olympics of conservation. The benefits go way beyond tourism. We have many, many islands in the Pacific that are being threatened and we have our own challenges here in Hawaii. The chance to collaborate with 160 nations provides a great opportunity to make some major changes that protect what we have and restore what we should."  

Brian Lynx, the vice president of meetings, conventions, and incentives for the Hawaii Tourism Authority, commented, "The economic impact is estimated at $37.7 million in visitor spending and $3.6 million in tax. Hawaii's selection further validates our position as an ideal location for high-level meetings and the cross-pollination of groundbreaking, world-changing vision and ideas. Their confidence in our ability to host a global conference of this scale is no doubt bolstered by our reputation for successfully handling other conventions of this scope and importance."

Source: Honolulu Star Advertiser, 5-22-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Honolulu Chinatown Community Unhappy About Growing Homeless Problem

Residents and business owners of the Honolulu Chinatown neighborhood are trying to work with city officials to resolve the growing homeless problem in their community.  While people seem resigned to the fact that the homeless are there to stay, there is increased frustration at the number of homeless who are using the Dr. Sun Yat-sen Memorial Park as a bathroom, and would like the city to build a public restroom there to reduce the stench. Andrew Friedlander, the principal broker for Colliers International, a commercial real estate company that operates several buildings in downtown and Chinatown, stated, "The homeless are living, urinating and defecating in the park every hour of the day. It's repulsive. We need to get the homeless out of Waikiki. We know we can't get them out of downtown. But we do need to take care of the filth and the smell, because it's embarrassing." Downtown Neighborhood Board member, Dolores Mollring, agrees and commented, "It's the perfume of Chinatown. It takes your breath away. The stench is so bad, and it's only going to get worse when the summer heat comes."

Currently, the only place where homeless can use a public restroom is at the Honolulu Police Department's Chinatown substation at the corner of Hotel and Maunakea Street, but officials acknowledge that this restroom is often out of order due to the abuse that user inflict on the facility. City Councilwoman Carol Fukunaga, who represents the downtown-Chinatown area, is proposing allocating $500,000 in the fiscal year 2015 budget to create and support a solution.

Source: Honolulu Star Advertiser, 5-22-2014, www.staradvertiser.com
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Nearly 12,000 People Apply for Honolulu's Section 8 Housing Choice Voucher Program

For the first time in just over nine years, Honolulu has started accepting applications for their Section 8 Housing Choice Voucher Program.  The window to sign up was just one week long, and over the first six days nearly 12,000 people requested to be on the wait list.  The "Housing Choice" program is part of the U.S. Department of Housing and Urban Development's Section 8 program, and allows voucher holders some flexibility in selecting where they want to live.  The typical rental voucher in Honolulu is $1,000 per month. Depending on the availability of funding, it is expected that there will be 200 to 500 slots available over the next few years, meaning that it could be another decade before this current wait list has been exhausted.

Source: Honolulu Star Advertiser, 5-21-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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State Mandating Increased Instructional Hours for Schools

Starting this fall, the State of Hawaii's middle and high schools will be required to provide a minimum of 5 1/2 hours of instruction per day, or a total of 990 hours per year.  The law also requires that all public schools have at least 180 days a year of instruction. Most schools are prepared for this increase, but there has been some challenges in comply without exceeding teachers' contract seven-hour workday and other labor requirements such as teacher preparation time.  The teachers union has argued that instructional time should be collectively bargained and not mandated by law.

By the 2016-2017 school year, all elementary and secondary schools would be required to provide an average of at least six hours of instruction time per day, or 1,080 hours per year.

Source: Honolulu Star Advertiser, 5-21-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Disney Cruise Line Set to Return to Hawaii in 2015

Disney Cruise Line has announced that they will be featuring two cruises through the Hawaiian Islands in 2015. The Disney Wonder will be departing Vancouver for Hawaii on September 7, 2015 and will be returning back to Vancouver on September 17, 2015.  Booking will begin on May 21, 2014 and staterooms will start at $1,650 per person based on double occupancy. Rebecca Peddie, Disney's manager of public affairs, stated, "Disney Cruise Line sailed to Hawaii twice in 2012 for the first time in our company's history. Our guests loved those itineraries and the Aloha Spirit of the islands, so we're thrilled to be returning for two more sailings in 2015."
 
Source: Honolulu Star Advertiser, 5-20-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Health Care Clinic in Kalaheo, Kauai to Close in September

The Hawaii Health System Corp. was announced that they will be closing their primary care clinic at Kala­heo, Kauai in September 2014.  Services and patients will be transferred to their facility at Port Allen, approximately four miles away.  Interim Chief Executive Officer for Kauai for HHSC, Scott McFarland, explained that the inadequate funding from the state of Hawaii and the rising costs of medical expenses forced the company to make this decision.  McFarland stated, "Neighbor island health care as a result of this lack of funding and financing is in jeopardy. The region requires a very high level of subsidy currently. Kauai is more of a canary in the coal mine for the fiscal health of the statewide system."

Alice Hall, the President and CEO for the entire Hawaii Health System Corp., added that medical companies can no longer sustain the rising costs of health care while continuing to provide the same levels of service.  Hall stated, "The state can't afford to come up with more and more money, and we can't absorb these costs. We're going to have to explore all plausible ideas on how to cut expenses, which may include cutting services and reductions in force. We believe all our services are essential, but we must examine all options in order to make up for the huge deficit that we're anticipating for next year."

Source: Honolulu Star Advertiser, 5-20-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Waikiki Businesses and Hotels Concerned About Homeless Situation

Over the last couple of years, Waikiki has seen record numbers of tourists staying in their hotels and frequenting their businesses.  However, the neighborhood has also seen an increased number of chronically homeless campers, aggressive panhandlers and people who are using sidewalks and parks as toilets, and the hotel and tourism industry are not happy about this at all.  The Waikiki Neighborhood Board, the Wai­kiki Improvement Association, the Hawaii Hotel and Lodging Association, the Oahu Visitors Bureau and the Hawaii Hotel & Visitor Industry Security Association, have joined forces with Waikiki residents and are demanding that state and city leaders enforce existing laws as well as consider creating new ones to prevent the problem from escalating further.

Real estate analysis Stephany Sofos commented, "We're just fed up with how this homeless issue has degraded our neighborhood. It's causing parts of our economy to fracture. Visitors don't want to come; people who live here want to move; and if investors start to realize that our community is decaying, they'll take their dollars out and put them in places that are thriving. It happened in Detroit and Sacramento and it will happen here.  It's Economics 101."

Source: Honolulu Star Advertiser, 5-19-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Architecture Graduate Students Present Proposals for Ward Village

Dr. Amy Christie Anderson, an associate professor at the University of Hawaii School of Architecture, came up with an interesting project for some of her graduate school students: come up with their own, original and innovative designs for a residential tower that would be built at the Ward Village in Kakaako. The assignment was a great success, and Nick Vanderboom, the senior vice president of development for the Howard Hughes Corp, which owns the 60-acre Ward Village, stated that it might be a great opportunity to interact with students and the university.

The graduate students, who are in their fifth year of a seven year doctorate program, worked all semester on their proposals and were given feedback from local architects. Upon completion of their assignment, the students presented scale models and rendering to several Howard Hughes Corp executives who gave the students constructive criticism and praise for their designs. It is not clear if Hughes Corp will use any of the designs or design elements for their next tower(s), but the interaction and collaboration seemed to be a very positive experience for all who participated.

Source: Honolulu Star Advertiser, 5-18-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Addressing the Deferred Maintenance Problem at the University of Hawaii System

The University of Hawaii is facing a significant problem with deferred maintenance issues across their 10-campus system.  According to UH officials, the problems would cost approximately $487 million to fix, with the vast majority of that amount, a total of $407 million, needed for the main Manoa campus.  The school is requesting that state lawmakers give them the authority to issue revenue bonds to fund the maintenance projects, and stated that the debt for these bonds would be repaid over the next 30 years by increasing tuition costs. Howard Toto, the UH Chief Financial Officer, stated, "We have, really, a situation where we need to think hard about how we want to proceed going forward. It's something we can't ignore, but we're somewhat inhibited by funding because we can't do a whole lot without the funds."

However, many lawmakers are not comfortable with the concept of increasing the financial burden of future students by dramatically increasing their tuition.  Issac Choy, a state representative and the chairman of the House Higher Education Committee, stated, "Let's just call a spade a spade: Revenue bonds mean tuition. The kids are the ones who were going to have to repay this."  The state was willing to give the University of Hawaii $50 million in state-backed general obligation bonds for next year for systemwide capital revenue and deferred maintenance needs.

Source: Honolulu Star Advertiser, 5-17-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Unemployment Drops to 4.4 Percent in April 2014

According to the state of Hawaii's Department of Labor and Industrial Relations, Hawaii's seasonally adjusted unemployment rate was just 4.4 percent in April 2014. This was a slight decrease from the 4.5 percent that was posted in March.  Honolulu County posted a 3.8 percent unemployment rate.  Maui County had a 4.6 percent unemployment rate.  Kauai County had a 5 percent unemployment rate.  Hawaii (Big Island) County had a 5.7 percent unemployment rate. County unemployment data is not seasonally adjusted.

Source: Honolulu Star Advertiser, 5-16-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Hawaii Hotels Hit Revenue Record of $1.44 billion in the First Quarter of 2014

According to a report issued by Hospitality Advisors LLC and Smith Travel Research, the state of Hawaii hit a record $1.44 billion in hotel revenue during the first three months of 2014.  This record setting number meant that hotel guests spent $250.36 a night on the average hotel room, an increase of 6.2 percent from the same period a year prior. President and CEO of Hospitality Advisors, Joe Toy, commented, "While high occupancy on Oahu and Maui continue to support strong (average daily rate) gains, there has been a noticeable moderation in price increases over the past six months. Room rates have been increasing, but we've been seeing the growth rate decline. Part of it is that we've actually been seeing a decline in room demand for the past 11 months and changes in price always lag changes in demand."

Managing Director for Starwood Hotels and Resorts, Kelly Sanders, cautioned, "Visitors from Asia, primarily Japan, really helped the first quarter come in much stronger than we had expected. However, it got worse in April, which was a very tough month across all hotels in Waikiki and then continued into May."

Source: Honolulu Star Advertiser, 5-15-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Slower Growth Expected for State in 2014

According to a report issued by the state of Hawaii's Department of Business, Economic Development and Tourism, Hawaii should see a GDP increase of 2.4 percent in 2014. This is slightly lower than their previous forecast of 2.6 percent that they had issued in February 2014, and is primarily attributed to a slowdown in the tourism industry.  DBEDT now predicts that the number of tourist arrivals will increase by just 0.7 percent in 2014, (previously predicted to be 1.7 percent) and visitor spending will increase by 2.3 percent (previously predicted to be 3.4 percent).

Source: Honolulu Star Advertiser, 5-15-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Queen's Medical Center West Campus Scheduled to Open on May 20, 2014

The Queen's Medical Center has announced that they will be opening their Ewa hospital location on the west side of Oahu on May 20, 2014.  The $100 million newly renovated facility will have over 80 beds including 23 beds in the emergency room.  They will also offer inpatient and outpatient surgery, imaging, cardiology and specialty clinics.

It has been over two years since the Hawaii Medical Center-West facility was closed their doors due to bankruptcy, leaving many residents on West Oahu concerned about emergency care.  Queen's acquired the facility in December 2012 and, at tat time, planned to invest over $70 million in the property.  However, Queen's ended up spending close to $30 million more than expected do to the fact that they needed to repair plumbing and wiring, and add new elevators and a new roof.   Chief Operating Officer for the West Oahu campus, Susan Murray, stated, "As the needs of the community grow, we'll grow right along with it. Our partners in health in this community are thrilled that we will be opening, because their ER departments have been overburdened and the length of time getting from (West Oahu) all the way into town is really an extensive distance. It can really add 30 minutes if you had to go past this site. Time is health, so when you urgently need care, the sooner you get to that care, the better."

Source: Honolulu Star Advertiser, 5-14-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Mokulele Airlines to Begin Flights Out of Kalaeloa Airport

Mokulele Airlines has announced that they will be beginning to offer commercial flights out of Kalaeloa Airport starting on July 1, 2014.  Kalaeloa Airport is located on the western side of Oahu and was formerly the Barbers Point Naval Air Station.  The first route that Mokulele will offer will be between Kalaeloa and Kahului Airport on the island of Maui. Ron Hansen, the chief executive officer for the airline, stated, "It's been a yearlong goal of ours, and it's finally happening and we'll see what the reception is. And if it warrants more flights based on bookings, we'll add more flights."

With regards to other potential destinations, Hansen added, "What we're trying to determine is where passengers want to go at this point. We feel the most conservative way to venture into this is with three flights a day into Kahu­lui, and the rest of the (airline's) flights will remain the same."

Source: Honolulu Star Advertiser, 5-14-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Possible Tax Increases for High End Properties

Honolulu City Council Budget Chairwoman, Ann Kobayashi, is proposing increasing the property tax for high-priced homes on Oahu.  Under Kobayashi's suggestion, all Residential A class properties, which refer to single family homes and condominiums priced at $1 million or more, would be taxed at $6 per every $1,000 of assessed value.  This is considerably more than the $3.50 per $1,000 of assessed value that owners are currently paying. However, it should be noted that Residential A class properties does not apply to primary residents, regardless on the value of the home.  Kobayashi stated, "Your house can be $10 million, but if you have an exemption, you're still in the residential class, not Residential A. The reason we put the $1 million figure is because we wanted to protect renters, and most people do not rent a home that's more than $1 million." Furthermore under Kobayashi's proposal, hotel and resort properties would be taxed at $12.90 per $1,000 of assessed value.  This would be slightly more than the $12.40 that hotel and resorts are currently paying.

The Honolulu Board of Realtors disagrees with Ann Kobayashi's suggestions and notes that the real estate industry defines luxury homes in Hawaii as those valued at $2 million and more. HBR suggests homes below $2 million pay $3.50 per $1,000 of assessed value, those properties that are valued between $2 million and $4 million pay $4.50 per $1,000 of assessed value, and those homes valued at more than $4 million pay $5.50 per $1,000 of assessed value.  Julie Meier, the President of the Honolulu Board of Realtors, stated, "We believe the threshold for any additional taxes should begin at $2 million. Any new property tax rate increase will have a negative impact on renters, because any rate increase will be passed onto them. We would like to see the city defer action on this measure until a more equitable, tiered rate structure can be considered."

Source: Honolulu Star Advertiser, 5-13-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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