Illegal Vacation Rentals Have Many Residents Frustrated

There has been a recent expansion of illegal vacation rentals throughout the island of Oahu and visitors hope to gain new experiences other than being in traditional hotels and tourist destinations. While small businesses have welcomed these visitors to their local economies, many residents argue that the volume of visitors have hurt the quality of life in their sleepy neighborhoods. According to research conducted by the Honolulu Star-Advertiser, the North Shore of Oahu and Kailua are the most popular areas for illegal vacation rentals and as many as 80 percent of these vacation rental owners are operating outside of city restrictions. Donna Wong, a member of the Kailua Neighborhood Board, commented, "It's creating a lot of conflict and hostility. Kailua used to be a quaint, small town where everyone knew everyone. Now, it's a resort. The North Shore has a similar situation. Visitor traffic used to be contained to surf season. Now, they've got it 24/7, 365 days a year."

In 1986, a law was passed that prohibited vacation rentals rented for less than 30 days in neighborhoods outside of designated resort areas.  In 1989, another law was passed prohibiting any new bed-and-breakfast homes in all zoning districts. However, the Hawaii Tourism Authority has noted that the city has failed to enforce these laws and rental property owners are blatantly violating regulations in recent years. It is estimated that between 78 percent to 87 percent of the North Shore and Kailua rentals are operating illegally.

Some tourism industry leaders believe that the city should relax restrictions and make these types of rentals legal, provided that homeowners pay the transient accommodation tax (TAT) and general excise tax (GET). Critics argue that illegal rentals should be stopped, as it increases traffic and crime in residential neighborhoods, drains community resources and reduces the supply of residential housing.

Source: Honolulu Star Advertiser, 12-28-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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Dillingham Ranch on North Shore Hopes to Build 106 Homes

Dillingham Ranch Aina LLC, has submitted an environmental assessment to the state requesting that they turn the 2,700 arce property into a subdivision for 106 homes.  Under the proposal, all of the properties will be "farm dwellings" which would mean that they would follow state and country regulations and be required to be primarily used for agricultural operations. A total of 91 of the lots would be at least 5 acres in size, plus a cluster of 15 homes close together.  The rest of the land would be refocused on orchard crops, like mango, avocado and lime, and on maintaining the existing cattle production and equestrian activities that the ranch is known for.

Critics argue that this proposal will simply create "gentlemen's farms," where buyers will build luxurious estate-type homes and engage in little or no commercial agriculture.  Under state and country regulation a buyer would simply have to plant a few fruit trees or have a couple of horse to be part of an agricultural subdivision.

Source: Honolulu Star Advertiser, 12-25-2014, www.staradvertiser.com
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Residents Near Laniakea Beach Build Fence to Block Tourists and Visitors

A total of eight residents living along Pohaku Loa Way near Laniakea Beach on the North Shore of Oahu spent $4,000 to build a 70-foot long wooden fence to block the private road from public use. Within days, vandals cut holes in three sections of the fence, causing the residents to state that they may build a steel rail or rock wall instead.  Dr. Carl Hodel, who organized the collection, stated, "How would you feel to have 1,200 people standing in your driveway every day, and you can't get out of your own driveway?"  Hodel noted that visitors illegally cross through Pohaku Loa Way as the closest and most convenient path to get to Laniakea Beach.

However, the city Department of Planning and Permitting has informed Hodel and the other residents that they have 30 days to remove the fence or face fines, as they did not obtain a building permit or a special management area permit.  Steve Cheung, a city planner, stated, "They have no permit at all. If they don't start to apply for a permit, they have to remove the fence by Oct. 16."

Source: Honolulu Star Advertiser, 9-18-2014, www.staradvertiser.com
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Turtle Bay Resort Adds Solar Panels to Roof

Turtle Bay Resort on the North Shore of Oahu has announced that they will be adding about 60,000 sq ft of solar panels to their roof to help bring about energy savings, but will be doing it in such a way that it is artistically pleasing to their guests.  The solar panels will create enough energy for about 8 percent of the resorts' consumption, saving Turtle Bay about $250,000 to $300,000 per year.  Scott McCormack, the vice president of real estate for Replay Resorts and Turtle Bay Resorts, stated, "We want to be leaders in the field in terms of showing other resorts how to become more green. We've been working on a number of energy conservation initiatives because, No. 1, we want to get our bills down and, No. 2, we feel like we have the responsibility to be good stewards of this land."

Source: Honolulu Star Advertiser, 9-15-2014, www.staradvertiser.com
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Polynesian Cultural Center Plans to Build Outdoor Marketplace

The  Polynesian Cultural Center has announced that they plan to build a 119,000 sq ft marketplace in front of their main attraction with free admission and free parking with validation. The Hukilau Marketplace is scheduled to open in January 2015 and will offer retail, dining and entertainment to patrons who decide not to enter the main park.  Alfred Grace, the president and CEO of the Polynesian Cultural Center, stated, "This is a really huge undertaking for the Polynesian Cultural Center. It really is the first time that we have reached out to the public with an offering that does not require an admission ticket and that will provide guests with a short-term experience at the Polynesian Cultural Center. Everything prior to that has been based on guests, visitors and locals alike, spending a full day at the Polynesian Cultural Center. So for the people driving around the island or looking for something to do for a couple of hours, this is an entirely new offering."

The marketplace will be open from 10 a.m. to 10 p.m. Monday through Saturday and will have several restaurants, a bakery, foot trucks, a high-end Hawaiian jewelry store, an ukulele shop, and other retail stores and kiosks.  Grace added, "We think that there's some great opportunities falling into place for the Polynesian Cultural Center and this community to be more self-sustaining. We haven't really ever been able to take advantage of the drive-by traffic that we have on Kamehameha Highway. With the marketplace and the (new) hotels (being built), the growth rates at the PCC actually will increase going forward rather than diminish as they have in recent years. We are confident we will see a reasonable return on our investment from this marketplace based on all the projections that we've done and the projections that Colliers Hawaii did. They also did an analysis of drive-by traffic and people who would stop and go to the PCC. We used some fairly conservative estimates to come up with some initial return on investment forecasts."

Source: Honolulu Star Advertiser, 6-22-2014, www.staradvertiser.com
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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
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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
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Update on Turtle Bay Resort

This past week the State of Hawaii and the City and County of Honolulu signed a preservation agreement with Turtle Bay Resort on the North Shore of Oahu.  Under this agreement, a total of 665.8 acres of land owned by Turtle Bay Resorts will be barred in perpetuity from any development.  Furthermore, there will be two planned oceanfront parks at Kawela Bay and Kahuku Point that will be reserved for public use.  In exchange for this concession, Turtle Bay would be paid $40 million from the state, $5 million from the city and $3.5 million from the nonprofit Trust for Public Land.  The owners of Turtle Bay would still have the legal right to develop two hotels for a combined 625 rooms and another 100 homes of 150 acres of land that front the ocean.

While many North Shore community members are happy with this compromise between the government and Turtle Bay Resorts, there are three major community groups that are still protesting the decision and state that this does not resolve their pending legal actions over development.  Defend Oahu Coalition, Keep the North Shore Country and Unite Here! Local 5 stated that they will continue to fight Turtle Bay's expansion plan of building two more hotels and 100 additional homes.

Source: Honolulu Star Advertiser, 4-19-2014, www.staradvertiser.com
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BYU-Hawaii to End All Intercollegiate Sports in 3 Years

Officials of the Brigham Young-Hawaii campus have announced that they will be phasing out its athletic program over the next three years.  According to the University, the resources being spent on athletics would be better used to help increase enrollment.  The school stated that the athletic department has an operating budget of approximately $1.2 million, and that money would be used to help grow the school to 3,200 students from its current 2,700 students.  The school will honor its current athletic scholarships through 2016.

Source: Honolulu Star Advertiser, 3-29-2014, www.staradvertiser.com
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BYU Hawaii Considering Eliminating Intercollegiate Athletics

Members of the Brigham Young-Hawaii administration are discussing whether or not the university will continue to offer intercollegiate athletics in the future.  BYU-Hawaii is operated by the Church of Jesus Christ of Latter-day Saints and currently has approximately 2,500 students on their Laie campus on the North Shore of Oahu.  The school features 11 different sports teams and have been quite successful over the years.  However, church officials note that BYU-Idaho, another school that is operated by the Latter-day Saints, had eliminated their intercollegiate athletic program and focused solely on academics.  Since making that decision, BYU-Idaho had achieved tremendous growth in enrollment.

Source: Honolulu Star Advertiser, 3-25-2014, www.staradvertiser.com
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Senator Clayton Hee Proposes Two Bills for Traffic and Erosion Problems on North Shore of Oahu

Two bills have been introduced by state Senator Clayton Hee to help ease traffic and beach erosion problems on the North Shore of Oahu.  The first bill that Senator Hee is proposing would move a section of Kamehameha Highway from Laniakea to Chun's Reef further mauka (closer to the mountains).  Hee is also suggesting that the state should create a wayside park on the makai (ocean) side of that portion of the highway.  Hee stated, "Right now, nobody's talked about a park, it's always been, ‘Move the highway. But it's been over a decade, so we're trying to spur the discussion and accomplish two things at the same time — the creation of the park and the movement of the highway mauka."

The second bill that Senator Hee introduced would have the University of Hawaii's Sea Grant College Program create a North Shore beach management plan for the North Shore of Oahu. Hee commented that this bill was prompted after high surf threatened several houses on the Rocky Point neighborhood.  Hee added, "It's important that legislators hear from the community and part of this is to mobilize the community to be a part of the solution as opposed to wondering what government solutions might exist."

Source: Honolulu Star Advertiser, 2-16-2014, www.staradvertiser.com
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Kahuku Wind Project Back at Full Capacity

First Wind has announced that their Kahuku wind energy project is back to working at full capacity after almost a year and a half of being shut down due to a fire that damaged the battery system at the plant.  The damage was repaired back in August 2013, but the energy output was limited to 5 megawatts as the Hawaiian Electric Company and First Wind ran tests to ensure that the new battery system was working properly,  The large turbines are now generating their maximum 30 megawatts of capacity and is being fed into the HECO grid.  This equates to enough energy to provide approximately 7,700 homes with electricity.  HECO will pay First Wind an average of 22.9 cents per kilowatt-hour.

Source: Honolulu Star Advertiser, 2-13-2014, www.staradvertiser.com
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Massive Waves on Oahu's Shores Fortunately Causes No Deaths or Damage

Honolulu's Department of Emergency Management was pleased to report no major damage to property and no loss of life was caused by massive waves that hit Oahu's North Shore and Leeward Coast line.  The waves, some with faces reaching 50 feet in height, were still challenged by expert and professional surfers, but city and state officials warn that theses waves are extremely dangerous for even the best athletes.  Lifeguards made two rescues on the North Shore and twelve rescues on the Leeward Coast.  On the island of Kauai, an elderly man sitting on the beach watching the surf was swept away by an especially large wave.  An off duty lifeguard managed to save him before he got swept out into the ocean.  The elderly man suffered from cuts and abrasions and was treated at a Kauai hospital.

While waves are expected to decrease to 20 and 25 feet in height over the next few days, lifeguards warn that these "smaller" waves can be extremely dangerous.

Source: Honolulu Star Advertiser, 1-24-2014, www.staradvertiser.com
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State and County Officials Shut Down Beaches Due to Huge Surf

Hawaii State and Honolulu County officials have shut down several beaches along the North Shore and Waianae coastline of Oahu due to huge surf.  Waves are expected to reach heights of 50 feet over the next few days. Shayne Enright, the spokeswoman for the city's Ocean Safety Division, stated, "We don't want anyone stuck in the parking lot if there's a surge. We're asking people not to risk their lives. That jeopardizes lifeguards' safety."

Director of Honolulu's Department of Emergency Services, Melvin Kaku added that this type of high surf is a once-in-10 years event.  Kaku stated, "What increases the hazard is the forecasted wave heights in combination with the long duration these swells will be impacting our shorelines. The long duration means that ocean waters will pile up in the surf zone, allowing the larger waves to impact farther into beach areas. This battering effect can cause increased shoreline erosion and damage to homes and infrastructure as well as blocking coastal highways with sand, debris and water."

Source: Honolulu Star Advertiser, 1-22-2014, www.staradvertiser.com
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Oceanfront North Shore Residents Concerned About Largest Ocean Swell in a Decade

The National Weather Service is predicting what could be the largest ocean swell in a decade hitting the North Shore of Oahu sometime over the next two days.  Matt Foster, a National Weather Service forecaster, note that waves could be as large as 25 to 30 feet in height (50 to 60 feet face) thanks to a calumniation of a storm 1,500 miles northwest of Hawaiian Islands and strong sustained winds on top of that.   While this is delightful news to professional big wave surfers and thousands tourists who are flocking to watch various surfing competitions, some North Shore residents who have oceanfront homes are concerned about the erosion that may occur because of the pounding waves.  Residents are doing their best placing sand bags and tarps along their property line, but truthfully it will be up to mother nature to see what damage, if any, would occur.

Source: Honolulu Star Advertiser, 1-21-2014, www.staradvertiser.com
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Conservation Easement Proposal With Turtle Bay Resort Faces Challenges

The State of Hawaii has proposed purchasing just over 600 acres of land from Turtle Bay Resort to create a conservation easement along the North Shore of Oahu.  Supported by Governor Neil Abercrombie, the proposal would allow the resort to continue using the land for recreational operations provided that they provide public access, but would prevent them from developing the land.  Turtle Bay Resorts would also retain ownership of the land under an easement. Members of the North Sore community are delighted with these suggestions by the state and Turtle Bay Resort representatives have stated that they would be willing to work with the Governor and the state legislature to come to a resolution that all parties can be happy with.

However, the biggest challenge comes down to money.  Under Hawaii law, the state government is not allowed to pay more for conservation easement than the property's appraised value.  State appraisers have come up with a preliminary appraisal range of $31.3 million to $38.3 million, and the state actually has a $40 million target price to purchase the land.  However, Turtle Bay's owners have stated that amount is far too low for them to accept.  If the Turtle Bay Resort is willing to accepted the price of $40 million, they may come up with additional compromises with the state including limiting the extent of public access and/or creating exceptions for the developer regarding required road improvements.  

One final option that the state could have would be condemnation, where the state seizes the land for public use and then pays the owner the appraised value.  However, if they were to do this, the Turtle Bay Resort would surely challenge that decision in court, which could cost the state millions of dollars in legal fees.  The state would also be responsible for managing and maintaining the property under condemnation.

Source: Honolulu Star Advertiser, 1-19-2014, www.staradvertiser.com
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Kahuku Residents Concerned Abut Proximity of Wind Turbines

Kahuku residents on the North Shore of Oahu expressed their concerns to representatives of Champlin Windpower LLC, who are proposing to put up an additional 15 wind turbines at the Na Pua Makani project.  These turbines would be adjacent to the 12 that were build in 2011 by First Wind LLC.  The nearest turbines will be about 2,100 feet from Kahuku's Mauka Village. Residents have asked that the turbines be moved further away from homes, schools and the community in general.  

Champlin Windpower hired Dr. Robert McCunney, a Harvard Medical School physician who specializes in occupational and environmental medicine to speak with concerned residents. McCunney stated that his research showed that the turbines were safe and did not pose any risk to the safety or welfare of any of the people living in Kahuku. Residents were a little skeptical about McCunney's claims and stated that they could hear the wind generated from the turbines.  While the residents appreciated the clean, green energy that was being produced by the turbines, they wanted to make sure that they were located further away from them, for peace of mind if nothing else.

Source: Honolulu Star Advertiser, 1-17-2014, www.staradvertiser.com
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North Shore of Oahu to Get Enormous Surf

The National Weather Service is forecasting enormous surf for the North Shore of Oahu over the next few days, with wave reaching up to 35 feet (70 foot face).  Lifeguards have posted warnings and have warned spectators who have gathered to watch the professional surfers to stay a safe distance away from any shoreline.  City officials have also noted that there is a potential for waves to wash over the highways. For residents who have beachfront properties in that area, there is a concern that waves may cause additional erosion of their property.

Source: Honolulu Star Advertiser, 1-17-2014, www.staradvertiser.com
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Turtle Bay Resort and Governor Working Towards Land Preservation Agreement

Governor Neil Abercrombie has stated that he is committed to working with the Turtle Bay Resort to come to a land preservation agreement by the end of this year. Under the Governor's proposal, the state would give the resort up to $40 million to create a conservation easement that would protect 610 acres of land at Turtle Bay from development.  The conservation land would stretch from Kawela Bay to Kahuku Point.  Chief Executive Officer of Turtle Bay Resort, Drew Stotesbury is optimistic about reaching and agreement and right now the main discussion point with the state is the final price.  The state appraised the 610 acres of land at between $31 million to $38 million, while the resort's appraiser came up with a much higher number.

Source: Honolulu Star Advertiser, 1-9-2014, www.staradvertiser.com
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North Shore Residents File Lawsuit to Remove Parking Barriers at Laniakea Beach

The Save Laniakea Coalition, which is made up of several residents and surfers living on the North Shore of Oahu, have filed a lawsuit against the state of Hawaii's Department of Transportation in an effort to remove the parking barriers that the DOT has placed at Laniakea Beach.  According to the suit the Department of Transportation was required to obtain a special permit and completed an environmental assessment before putting up the barriers.

According to the Department of Transportation, the barrier are designed to help solve traffic problems along Kamehameha Highway.  Over 600,000 people visit Laniakea each year to watch the large surf and look at the green sea turtles that live in the waters offshore.  However, the DOT noted that cars, vans, and tour buses park along Laniakea Beach causing traffic and safety concerns.  Officials with the Department of Transportation have stated that the barriers are designed to be temporary, though did admit that they could stay in place for several years if they are effective.

Source: Honolulu Star Advertiser, 1-3-2014, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Principal Broker, REALTOR®
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