Electrical Rates on Oahu Lowest in Months

According to a report released by the Hawaiian Electric Company (HECO), electrical rates for the island of Oahu in November were the lowest that they have been since Februray 2012.  Residential consumers spent 31.9 cents per kilowatt-hour on Oahu, a decrease from the 33.6 cents per kilowatt-hour in October.  Experts attribute this reduction due to lower fuel oil prices which HECO uses to power their generators.

In comparison, Maui customers spent 39.6 cents per kilowatt-hour.  Big Island of Hawaii residents spent 39.0 cents per kilowatt-hour, while Kauai resident spent the most across the state at 43.9 cents per kilowatt-hour.  The state of Hawaii has the highest electric rate in the country with an average of 37.04 cents per kilowatt-hour.  According to the U.S. Energy Information Administration, the national average is 12.17 cents per kilowatt-hour.

Source: Honolulu Star Advertiser, 11-23-2012, www.staradvertiser.com
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Sheraton Spends $230 Million to Renovate Four Hawaii Properties

Sheraton Hotels & Resorts, has just finished renovating four properties in Hawaii to the tune of $230 million.  The Sheraton Waikiki received the bulk of that money with $188 million spent completely renewing the property.  The Sheraton Maui Resort & Spa got a $6.5 million face lift, while the Sheraton Kauai Resort for a $16 million upgrade.  The Sheraton Kona Resort on the Big Island of Hawaii finished a $20 million renovation.  Sheraton executives are confident that the money spent will be worth it with Hawaii’s improving tourism economy.

Source: Honolulu Star Advertiser, 11-22-2012, www.staradvertiser.com
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HPU Hopes to Manage and Redevelop Aloha Tower Marketplace

Hawaii Pacific University has prepared a proposal to the Aloha Tower Development Corp. to manage and redevelop the Aloha Tower Marketplace.  Under their plan, the university would spend approximately $32 million to completely overhaul the waterfront marketplace.  A dormitory for 320 students would be built on site, as well as a new sports and entertainment complex.  New retailers and restaurants would also be added under HPU’s management as well as additional parking stalls.

Source: Honolulu Star Advertiser, 11-22-2012, www.staradvertiser.com
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Forest City Enterprises and Lend Lease Willing to Build 400 Foot Towers Instead of 650 Foot Tower

The Hawaii Community Development Authority had originally hoped to construct a 650 foot tower in Kakaako at 690 Pohukaina Street and had solicited bids by both Forest City Enterprises and Lend Lease to come up with designs.  The concept of creating extra tall mega towers was championed by Hawaii Governor Neil Abercrombie, who felt that it would benefit the city’s urban design and allow developers to deliver affordable housing to Hawaii’s population.  However, the thought of building a tower 250 taller then the current tallest building has generated a lot of public outcry.  As a result, both Forest City Enterprise and Lend Lease have public stated that they would be willing to build towers at 400 feet, is that is decided by the Hawaii Community Development Authority.

Forest City commented that they have three proposals submitted and have no preference on which one is selected.  The first would be to build one 650 foot tower.  The second would be to create a 560 foot tower and a 400 foot tower.  The third plan would be to build two towers at 400 feet each.  Lend Lease has proposed building two towers, with one being 400 feet tall and the second, if approval is given, being 650 feet tall.  However, they could easily reduce the height if the second tower to 400 feet.

Source: Honolulu Star Advertiser, 11-21-2012, www.staradvertiser.com
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Honolulu Rail Project – $1.55 Billion in Federal Funding

Hawaii’s congressional delegation has announced that they have secured $1.55 billion in federal funding for the Honolulu Rail Project.  The final commitment will take place with the signing of a Full Funding Grant Agreement, which should occur by the end of the year.  Once signed the city would received $200 million in federal funding for their 2012 budget and additional $230 to $250 million per year over the next five fiscal years.  United States Senator Daniel Inouye stated, ”This is an important step toward providing federal funding for the Hono lulu rail transit project.  By providing a new option for Oahu commuters to avoid traffic congestion, rail will save families time and money and will reduce pollution in the air we breathe. I look forward to the rail project’s completion.”

Rail opponents still warn that that the project still faces lawsuits in state and federal court and hope for continued injections preventing construction work from proceeding.  However, Executive Director for the Honolulu Authority for Rapid Transportation, Daniel Grabauskas, believes that these legal cases would not stop the rail project.  Grabauskas stated, ”No roadblocks have been put in our place as a result of the court cases.  Perhaps a detour and a little extra work we need to do, but no roadblock. That’s ultimately what the FTA was able to determine. Therefore, they were able to say, ‘We’ve already looked at your cost and schedule base line, and it’s in very good shape.’”

Source: Honolulu Star Advertiser, 11-20-2012, www.staradvertiser.com
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Oahu Top Island and Sun Destination in World

According to a report released by Hospitality Advisors LLC, Oahu is the number one island and sun destination in the World in terms of hotel occupancy rates during the first three quarters of 2012.  The study compared island and sun destinations globally, and Oahu clearly held the lead with 85.6 percent occupant through September.  Puerto Rico was second with74.5 percent occupancy, followed by the island of Maui with 73.3 percent.  Rounding out the top five was Phuket with 71.0 percent occupancy and Bali with 70.5 percent occupancy.  Two other Hawaiian Islands made the top 10 with Kauai at number six and the Big Island of Hawaii in tenth place.  President and CEO for Hospitality Advisors, Joseph Toy, stated, ”Hawaii’s strong recovery, and in particular the record pace in hotel revenue, have helped strengthen each island’s performance among,  the island and sun destinations.”

Vice president of Hilton Hawaii, Jerry Gibson, added, ”The people of Oahu should be very proud to be at the top of this list of world-class destinations.  For Oahu, as well as Maui and Kauai, to be among the likes of Bali, Phuket and Puerto Rico is a credit to the hotels and their marketing partners including Hawaii Tourism Authority, Hawaii Visitors and Convention Bureau, and all the island visitors bureaus.”

Source: Honolulu Star Advertiser, 11-20-2012, www.staradvertiser.com
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Honolulu Rail Project – Concern Rises About Finmeccania’s Credit Rating

Italian Company Finmeccanica is the parent company of the two rail transportation firms that make up Ansaldo Honolulu.  Ansaldo is the company that had been given a $1.4 billion contract to build the train cars for the Honolulu Rail Project and maintain the rail system. Recently, it was announced that Finmeccanica had been given a BBB- credit rating by Fitch Ratings, which is just one step above junk-bond status.  Finmeccanica has a large amount of debt and has been talking about significant restructuring for over a year.

Members of the Honolulu Authority for Rapid Transportation (HART) have expressed their concerns and wanted some assurances from Finmeccanica that things would progress as planned and that Finmeccanica would not sell Ansaldo to a third party.  Finmeccanica assured the city that their restructuring does not currently include Ansaldo.

Source: Honolulu Star Advertiser, 11-19-2012, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Broker-in-Charge, Realtor®
Global Executive Realty, LLC
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