January – March 2009 Mixed Plate of Talk Story

Here is a link to Beach Villas at Ko Olina, an oceanfront development that may be of interest to some readers. The link takes you to a photograph of the area. Beach Villas are the two towers overlooking the second lagoon from the top. The public golf course is to the right with the marina at the bottom of the picture. Click on the New Photo Gallery in the right hand margin for additional photographs. 126 of the 247 units have been sold with 121 still available but off the market. The developer has decided to sell all the remaining units on June 6^th & 7^th in what they have titled the Final Sales Event which also could be titled a massive Fire Sale with prices slashed 25% to 35% with some units likely to be discounted even more.

The units in Beach Villas are either 2-bdrm or 3-bdrm and come fully furnished with quality contemporary Hawaiian furniture that is identical in all the units. With some few exceptions, all the units have a protected ocean view that ranges from being spectacular to merely a partial ocean view. When you look at the floor plans, the ocean view from each unit is across the lanai. Prices depend on size, location and view. On any given floor, the 3-bdrm units are more expensive than 2-bdrm units, however, 2-bdrm units on high floors are more expensive than 3-bdrm units on lower floors. The four family members have mixed opinions as to whether we prefer additional size and/or an additional bedroom versus a better view or a better location. Two pets are allowed with no size restrictions.

The units can be rented by the week or long-term with a separate company available to handle rentals. One nice feature is the ability to lock a bedroom, so an owner could store personal items while they are gone and still be able to rent the remainder of their unit. The maintenance fee ranges from about $1,200-$1,650 per month and covers practically everything with the first 12 months included in the sales price. We believe the Beach Villas units are marvelous for full-time use or for owners that alternate between living in Hawaii and on the Mainland. The discounted sales prices are very attractive; however, the units still do not pencil-out well as an investment. Unit selection at the sale will depend upon date of registration. A $50,000 fully refundable fee is required to be registered. The sales staff informs me that they believe they have sufficient registered buyers for all the lesser expensive units. A buyer who registers today should expect to pay $700,000 or more for either a 2-bdrm or 3-bdrm unit. A very nice 3-bdrm unit with a full ocean view is expected to be in the  $1.2-1.3 million range.

For additional information, check the applicable block on the enclosed postcard and return it. Or, contact us or call us toll-free (1-800-922-6811). If you do not plan to be here for the June 6-7 Final Sales Event and want us to represent you, we’ll need authorization plus the ability to reach you by telephone, similar to what we did with the Trump Tower in Waikiki. There is a 30-day sales rescission that enables you to be able to inspect/cancel your purchase after the Final Sales Event. The information herein is similar to what I provided owners on my e-mail net about a month ago. Several of those owners were interested in exchanging real estate they own either in Hawaii or elsewhere for a unit in Beach Villas. That is not of interest to the developer who wants all remaining Beach Villas units to be sold as soon as practicable. As the sale progresses over the two-day period, there may be some improvement in sales prices for those models/units that are not getting buyer activity.

On to other matters . . . Waikiki’s original luxury hotel, the “Pink Palace of the Pacific” or the Royal Hawaiian has recently reopened to grand hoopla after having been shut for seven months for extensive upgrades. Prior to WWII, the hotel was well known as a playground for the rich and famous. Following is their famous recipe for the Royal Mai Tai from the Mai Tai Bar manual: 1 oz. pineapple juice; a dash of cherry vanilla (a puree of maraschino cherries and vanilla); 1 oz. Bacardi rum; ½ oz. Cointreau; ½ oz. Amaretto; ½ oz. dark run (floated on top). Serve with a cherry, a wedge of pineapple and lime.

The Navy had egg on its face in February as the USS Port Royal, a 9,600-ton, 567-foot guided missile cruiser ran aground about a half-mile off Honolulu International Airport’s reef runway. The ship had just come out of dry-docking after a four-month refit and was in the midst of post-docking sea trials. The bottom is sandy in that area; however, a group of commercial and Navy tugs were unable to pull the ship free. This was finally accomplished by removing weight such as anchor chain, water, etc. in conjunction with the tugs. It took four days to free the ship with all the efforts being very visible to the public. As might be expected, the commanding officer has been relieved . . . Three more well-known restaurants have recently shutdown: Blue Moon in the Ward Warehouse, a microbrewery that featured excellent pupus and a wide variety of beers including an interesting beer sampler; 4-year old E & O Trading Company in the Ward Centre that left the second floor, once a spot for eating, drinking and dancing, with only Ryan’s Grill as a restaurant; and Nick’s Fishmarket in Waikiki that opened more than 40 years ago and often made best restaurant lists for seafood . . . Hawaii’s business travel market has lost tens of millions of dollars in bookings, as companies have had to say aloha to vacations in exotic locales and pricey spending on business-related food, beverages and entertainment. For example, Wells Fargo, a company that received emergency government funding, has cancelled a corporate event that would have generated 11,000 room-nights at the Hilton Hawaiian Village in May.

How would you like to go away on vacation and find another family living in your rental property when you returned with the locks changed? That recently occurred at a unit in Aikahi Gardens, which is right down the street from our office.  This type of scam where someone rents out property with advanced rental deposits being sent out-of-state, in this case to Nigeria, is becoming increasingly common. Recently, the Better Business Bureau and the Honolulu Board of Realtor issued a joint alert that I discussed in my last newsletter. This was the first case over the past year, though, where a scam victim actually moved into a property after having paid advance rent. Often, the rental property doesn’t even exist even though the scam artists have pictures posted on Craigslist or other websites . . . A study by Harvard Business School found that Hawaii has the second-highest rate of online pornography subscribers in the nation. The study collected data over two years of credit-card purchases from adult entertainment Web sites. The study found slight differences in online purchasing habits based on education, urbanization and income with Utah being the porn leader; however, the states appeared to more similar than dissimilar with no meaningful correlations between red or blue states, those that have passed laws banning gay marriages, etc.

Much of the local news these days deals with how the city & state are going to be able to balance their respective budgets without having to either reduce the salaries of or terminate city & state union members (voters). Some of the schemes to shift funds around remind me of a massive shell game such as borrowing funds collected for the rail system or using educations funds and banking on federal stimulus funds being provided for education . . . A controversial program now being considered is a state-funded plan to provide airline tickets to the homeless, about 20% of whom have been in Hawaii for less than a year. It is an experience to drive up the Waianae Coast and see mile after mile of homeless tents on the beach. Shelters don’t tend to work too well, as many (most?) of the homeless would prefer to live in a tent on the beach rather than in a shelter with various rules/restrictions . . . Hawaii and Utah are the only two states without legalized gambling. With the sagging economy, legalizing gambling has once again become an issue albeit one that is unlikely to have the legs to go too far . . . Several years ago one of the newspapers ran a poll listing the Mainland franchise readers would most like to come to Hawaii. The overwhelming winner was Target. On March 5^th they got their wish as the first two Target stores opened the same day, in Kapolei and Salt Lake. A third store in scheduled to open in July in the Big Island’s. 1,800 people passed through the doors of the Kapolei store within the first 30 minutes. Two of the first-day Target shoppers were my wife, Mary Lou, and my daughter, Tracey. My son-in-law, Tim, and I somehow managed to be able to take a pass on that experience.

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