Honolulu rental home rates rise nearly 15 percent, new report says

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The homes in the gated community of Hawaii Loa Ridge.

The homes in the gated community of Hawaii Loa Ridge.

The average monthly rent for a single-family home in Honolulu rose nearly 15 percent to $2,675 in the fourth quarter of 2015 — nearly doubled the national average — according to a new report.

The data used rents on three-bedroom single-family homes. Nationally, rents rose 3.1 percent to $1,353 per month from $1,312 per month when comparing year-over-year totals.

“Although there have been recent events that will have some impact on Hawaii’s overall rental market such as the decrease in the military’s housing allowance and the shut-down of HC&S on Maui, low unemployment, a limited housing supply, and an overall positive economic health forecast for the year will likely continue to push Honolulu rental prices upward,” said Kawika Burgess, president and CEO of Real Property Management Alliance, a Honolulu franchisee of the Real Property Management franchise system.

The vacancy rates for this market in Hawaii rose to 3.5 percent through the fourth quarter of 2015, an increase of 0.03 percent in the same quarter last year.

Nationally, this rate dipped to about 5 percent from about 5.6 percent when comparing the fourth quarters of 2015 and 2014.

The Real Property Management Alliance report also noted that, in Hawaii, about 34 percent of single-family homes are rented.

Duane Shimogawa
Reporter
Pacific Business News

Stanford Carr to develop $300M Makaha Valley resort project

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Hawaii developer Stanford Carr will develop a $300 million golf resort community with a four-star hotel on the site of the former Makaha Resort for landowner Pacific Links International as part of a joint venture that aims to create some 500 jobs for residents of the Leeward Oahu community.

The resort master plan for the property, which was acquired by Pacific Links last year through foreclosure, was developed with members of the community, Pacific Links and Honolulu-based Stanford Carr Development said in a joint statement released on New Year’s Day.

Pacific Links initially planned to spend some $200 million to develop a 483-unit resort with 250 hotels rooms, 88 luxury villas and 145 luxury time-share units, Pacific Links board advisor Micah Kane, then the company’s chief operating officer, told PBN in May.

The Friday announcement did not detail the number of units now planned, but did mention the resort’s golf course, the former Makaha West Golf Club, which is undergoing a $30 million redesign by PGA Tour legend Greg Norman, who’s known as The Shark, and a four-star hotel “focused on providing a Neighbor Island experience on Oahu.”

The Makaha Valley resort property was initially developed by the late Hawaii financier Chinn Ho in the late 1960s, and was managed by Sheraton until 1999.

It’s located about 12 miles up the Leeward Coast from Ko Olina Resort — home of Aulani, a Disney Resort & Spa, and where the Four Seasons Resort Oahu is opening in April— and about 35 miles from Downtown Honolulu and Waikiki, the state’s main resort district. It is more than 50 miles from Turtle Bay Resort, the only resort on Oahu’s North Shore.

“As the last of four master-planned destination resort communities on the Island of Oahu, Mākaha Valley has an incredible opportunity to retain its rugged beauty while providing a welcoming and eco-friendly environment for residents and visitors,” Carr, president of Stanford Carr Development, said in the statement. “We look forward to continuing to work with the community to create a neighborhood that everyone is proud to call home.”

An integral part of the Makaha Valley master plan is to restore the watershed and native environment while creating jobs for a community with a high unemployment and poverty rates. The site’s former hotel, the Makaha Resort & Golf Club, closed in late 2011 after Canada-based Northwynd Properties Ltd. acquired the property, leaving 95 employees out of work. Northwynd had plans to upgrade the property and convert the hotel into time-share units, but was unable to secure financing.

“Our hopes and aspirations for the Makaha ahupuaa reflect the vision this community has expressed to us, which is to strengthen the area overall, both now and into the future,” Kane said in the statement. “We consider this a three-way partnership with the Makaha Community, Pacific Links and Stanford Carr, bringing together the team needed to make this joint vision for Makaha Valley a reality through a very local perspective.”

Janis L. Magin
Managing Editor
Pacific Business News

Hawaii to receive $9M HUD grant for affordable housing

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This 630 Cooke St. lot in Kakaako will be home to a future affordable housing project.

This 630 Cooke St. lot in Kakaako will be home to a future affordable housing project.

The Hawaii Public Housing Authority will receive a $9 million grant from the U.S. Department of Housing and Urban Development as part of its Capital Fund Program for Public Housing Agencies, the state’s congressional delegation said Friday.

“The lack of affordable housing is an issue that is reaching a critical point in Hawaii,” U.S. Rep. Mark Takai, D-Hawaii, said in a statement.

“This funding will help replace distressed units, support jobs in our community, and bring quality affordable housing within reach for many Hawaii families,” U.S. Rep. Tulsi Gabbard, D-Hawaii, added. “With this grant, the Hawaii Housing Authority will be able to improve housing units across our state.”

The HUD Capital Fund program supports more than 3,000 public housing authorities across the nation to build, repair, and modernize public housing projects.

Energy efficiency and large-scale improvement projects may be supported by the fund as well.

Lorin Eleni Gill Reporter – Pacific Business News

Honolulu among top 10 most inspiring cities for photographers

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If you live in Hawaii, you’ve likely got some impressive photos on your Facebook or Instagram feed.

Turns out, a lot of people here do, which is why a Florida-based website considers Honolulu one of the best places in the nation to snap a photo.

Printaholic.com put Honolulu on its list of top “10 Most Inspiring Cities for Photographers,” noting that “apart from the exotic scenery, photographers will love taking photos of Hawaiian architecture and culture.”

Other cities include:

Seattle, Washington
Portland, Maine
New Orleans, Louisiana
Savannah, Georgia
Portland, Oregon
St. Augustine, Florida
Newport, Rhode Island
Anchorage, Alaska
Ann Arbor, Michigan

http://khon2.com/2015/01/21/honolulu-among-top-10-most-inspiring-cities-for-photographers/

Relief on the way for owners of older Hawaii homes

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The Hawaii State Historic Preservation Division has come up with a list of home-improvement projects, including solar photovoltaic installations, interior renovations for mid and high-rise buildings and bathroom and kitchen repairs, that have no potential to affect historic properties based on previous reviews and staff judgement.

The new list is aimed at easing the burden of unnecessary reviews on owners of homes built 50 years ago or more across Hawaii, reducing the demands on staff time in county planning departments and decreasing the need for SHPD architecture staff to do unnecessary reviews.

It also will allow SHPD to focus its efforts on the projects that have a real potential to affect historic properties and to engage in proactive preservation activities, the state agency said.

Once the final list is compiled, it will be given to the state agencies with permitting authority and the four county planning offices for implementation.

SHPD has opened a comment period for the new list until Nov. 28. Comments should be sent to Anna Broverman.

The SHPD Architecture Branch spends about 80 percent of its time reviewing permits on homes that are 50 years old or older.

During the last fiscal year that ended June 30, the branch reviewed about 6,000 projects, 3,670 of which were reviewed in accordance with the law.

Most of the projects reviewed involved additions or alterations to homes that range from interior electrical upgrades to demolition.

SHPD said its analysis of these reviews shows that the majority result in a determination of “no historic properties affected.”

Additionally, this analysis indicates that some types of projects always result in a “no historic properties affected” determination.

Other projects on the new list include installation of electrical meters, interior electrical upgrades, demolition of additions and detached structures less than 50 years of age, in-kind repairs of interior and exterior features such as doors, windows, siding, fascia and decking, antenna and satellite dish replacements on existing towers and structures not subject to FCC permits, in-kind repairs to carports and garages and the enclosure of existing rear lanai.

The Building Industry Association of Hawaii and historic preservation officials in the state have not seen eye to eye on this issue.

BIA-Hawaii contends that the 2008 law mandates that SHPD complete a time-consuming review of a potential historic home’s building permit application if a homeowner plans to renovate or rebuild their home.

Duane Shimogawa Reporter – Pacific Business News

New Hawaii cesspool proposal could hurt home sales, real estate leaders say

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The leaders of the Honolulu and Kauai Board of Realtors said that a proposal to eliminate residential cesspools in Hawaii may have good intentions, but it would have unintended consequences.

Both Jack Legal, president-elect of the Honolulu Board of Realtors, and Karen Ono, executive director of the Kauai Board of Realtors, said that while they are not opposed to the Clean Water Act, the Hawaii State Department of Health could stymie home sales if it decides that rural new homeowners must replace their cesspools with septic tanks, which can cost cost up to $10,000 or more to install.

The DOH is proposing that new homeowners have 180 days from the date of sale to replace cesspools with septic tanks.

Ono said that could add thousands of dollars to the costs of the home, and both Ono and Legal say that mortgage companies would be less likely to approve a loan for a home that would need a new septic tank.

Legal said the new rules would discourage both the seller and the buyer.

The new rules would affect 77,000 homeowners on Neighbor Islands, and 11,000 on Oahu, including to Thelma Dreyer, a spokeswoman for the Hawaii Senate.

The proposal would also require new developments that have at least 15 lots to have septic tanks or sewer systems. That number is now 50, Ono said.

In a letter to the state Department of Health, Sen. Rosalyn Baker, who represents parts of Maui, said the proposed 180 days for homeowners to make the change to septic tanks fails to consider issues they may encounter for things such as permits and whether landowners would be able to connect with the county system.

Baker wrote that the DOH says that while there are now now almost 90,000 cesspools, with 50,000 on the Big Island, 14,000 on Kauai, 12,000 on Maui, 11,000 on Oahu and 1,400 on Molokai, but the DOH planned only one public hearing on the proposed changes, on Oahu, although it was videoconferenced to Neighbor Islands.

“It is unfortunate that DOH has chosen to pursue changing its administrative rules without seeking meaningful input from the landowners and communities most affected,” Baker wrote.

But now, the Department of Health said that it would hold meetings on Neighbor Islands and extend the public comment period through Oct. 17.

Bill Cresenzo Reporter – Pacific Business News

Brewbaker says median price of an Oahu single-family home may hit $1M by 2018

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Paul Brewbaker

Paul Brewbaker

Paul Brewbaker is the go-to economist for several Realtors’ organizations in Hawaii, and five years ago, he predicted that the median price of a home on Oahu would hit $1 million by 2017.

His prediction was based on the projection that homes prices would appreciate by 15 percent each year.

Instead, he said, home prices have appreciated by 5-10 percent year-over-year, so now, his current timetable for hitting the $1 million mark is between 2018 to 2022.

In June, the median price of a single-family home on Oahu hit a record $700,000.

“We’re not getting as strong a signal from home-price appreciation, and that is part of the reason why new home production is less robust than I anticipated a few years ago,” he said. “Still, I think that supply constraints are more of an issue than lack of housing demand.

“Either way there is less energy in the housing market today than I imagined would be characteristic of the housing market at the end of the recession five years ago,” he said.

Brewbaker made the comments in a Q&A with PBN in which he calls out the state of Hawaii for making bad business decisions, such as obstructing development. He also says the state’s energy policies have led to high electricity rates and calls the state of Hawaii an “idiot” for providing equity to film and television shows without getting residuals in return.

Read more about what Brewbaker has to say about the Hawaii economy here and in Friday’s print edition of Pacific Business News.

As Oahu home prices rise, so does the need for affordable housing

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Julie Meier, the president of the Honolulu Board of Realtors, said Monday that while she isn’t surprised the median price for a single-family home on Oahu hit a record-breaking $700,000 in June, she is somewhat surprised that it has happened so fast.

A lack of inventory coupled with high demand sent home prices through the roof in June, according to the board.

Oahu has 2.8 months worth of single-family homes on the market and a condo inventory of 3.3 months, meaning that’s how long it would take to sell every property if no new listings were to come on the market.

Those numbers mean it’s a seller’s market, because a balanced market has about six month’s worth of inventory, said Meier, who’s also a Realtor with Prudential Locations.

Inventory increased by 4 percent in June, to 1,200 active single-family home listings, from 1,153 in June 2013. Condominiums fared better, with the inventory increasing 19 percent to 1,749 listings from 1,473 units listed during the same month last year.

“We do have projects in the works, but most are a long way from completion and they cater to a more affluent [clientele],” she said.

The latest figures confirm Oahu’s need for housing at the other economic spectrum, Meier said.

And Meier said that the rising home and condo prices will have a ripple effect, so expect rents to rise, too.

Julie Meier, president of the Honolulu Board of Realtors.

Oahu condo prices hit record high

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Mar 7, 2014, 6:59am HST
Bill Cresenzo Reporter – Pacific Business News

The median price of a condominium unit on Oahu hit a record high in February, according to the Honolulu Board of Realtors. Seen here are the twin oval towers of the Moana Pacific condominium in Honolulu.

The median price of a condominium unit on Oahu hit a record high in February, according to the Honolulu Board of Realtors. Seen here are the twin oval towers of the Moana Pacific condominium in Honolulu.

The median price of a condominium on Oahu hit a record high of $359,450 in February, while the price of a single-family home rose 13 percent, according to figures released Friday by the Honolulu Board of Realtors.

The condo median price was a 5.7 percent increase from the the median price in February 2013, which was $340,000. The previous condo price record of $350,000 was set in August, the board said.

Sales of condos rose 6.1 percent, to 296 units sold in February from 279 units sold during the same month last year.

The median price of a single-family home rose 13.2 percent to $679,000, from $600,000 in February 2013. Sales dipped 5.5 percent, to 201 homes sold from 190.

“These are very good numbers for what is historically our slowest month of the year,” Julie Meier, president of the Honolulu Board of Realtors, said in a statement. “Sales of single-family homes were down mainly due to a lack of inventory in the mid and lower price bands.”

Sales in February included a $9 million home in Lanikai, Meier noted.

Hawaii real estate outlook for 2014: Sunny with a chance of rain

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Jan 22, 2014, 2:21pm HST
Duane Shimogawa Reporter – Pacific Business News

Some 700 people from Hawaii's real estate industry turned out for a 2014 forecast that was mostly positive.

Some 700 people from Hawaii’s real estate industry turned out for a 2014 forecast that was mostly positive.

The 2014 Hawaii Real Estate Forecast on Wednesday at the Hawaii Convention Center saw the return of the “wizard,” some amazing photos of a Japan ski trip and mostly positive predictions for this year’s industry outlook.

On hand were some of the biggest names in Hawaii’s real estate industry, including panelists from Jones Lang LaSalle, Colliers International Hawaii, Ambard & Co. Commercial Real Estate, Prudential Locations and Bishop Street Commercial.

Wendel Brooks III, who recently left CBRE Hawaii to head up rival Jones Lang LaSalle’s retail operation, kicked the event off with a retail forecast that looks mostly sunny with a possibility of rain in 2014.

“Plan on delays,” he said in his presentation. “Construction will cripple parts of Oahu [and] rents will continue a slow upward trend. We have seen the bottom.”

Brooks also said that retailers and restaurants Hawaii should soon expect to see include Sonic Drive-In, Olive Garden, H&M, Bloomingdale’s, Ulta Beauty, Urban Outfitters, Sport Chalet, Dick’s Sporting Goods, DSW Inc. and Uniqlo.

Additionally, he pointed out that Hawaii should expect the expansion of retailers and grocery stores such as Safeway, Target and T.J. Maxx.

Bishop Street Commercial’s Matt Bittick took to the podium next but not before taking a “selfie” with Hawaii News Now’s Howard Dicus, who also was the moderator for the event, attended by some 700 people.

Bittick predicted that by the end of this year, the office market vacancy rate in Honolulu will hover around 13 percent, which is slightly lower than what CBRE Hawaii reported in the fourth quarter of 2013.

A year ago, nearly 15 percent of Honolulu’s office space sat empty, CBRE Hawaii said.

Whatever the case, Bittick noted that office space in Honolulu is still cheaper when compared to other markets such as San Francisco.

For Mark Ambard of Ambard & Co. Commercial Real Estate, who made sure to show the audience some of his recent Japan ski trip photos during his presentation, the industrial market will require lots of patience.

“Space is available, but not abundant [and] business growth is still relatively slow [with] current spaces often not matching current users,” he said in his presentation. “Develop now if you can find land. Rents will go up [so] tenants should lock in now. Land is gold, get now, develop now.”

From one colorful presentation to the next, Mike Hamasu of Colliers International Hawaii didn’t forget to bring his popular wizard hat to the podium.

His investment report encompassed some positive numbers for 2013 with $3.9 billion in sales, a 78 percent jump from the $2.1 billion recorded in 2012.

Led by hotel and apartment sales, the investment market is as active as it has been since the Great Recession.

And Hamasu, who jokingly mentioned that he is accepting donations for a new wizard hat, said he projects to see more of the same in the investment market in 2014.