Market Reports

Tag Archives: Shopping Centers

Hawaii Shopping Center sells for near 10% return

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Recently the Kele Center, located on the island of Maui in the city of Kahalui, sold.  The Shopping center is approximately 14,820-sq. ft. and sold at a price of $4,925,000.  Anchored by Denny’s Restaurants, Super Cuts, Rent-A-Center, and Edward Jones, this well-located community center was a great investment for the new owners.  The property is located just outside of the airport and down the road from Borders, Sports Authority, Lowe’s, and Costco.  The property sits on a land area of approximately one acre.  This Hawaii commercial investment will provide a nearly 10% return to the new owners of this property.

This is another example of a substantially higher rate of return (CAP Rate) than was achievable by investors just a short 24 months ago.  While it did take a large equity investment in today’s financing environment, the owners will be rewarded for making a move at this time in the marketplace.

I believe 2009 and 2010 will be looked at as low points in the Commercial Real Estate cycle for Hawaii.

Are foreign investors back in the Hawaiian commercial real estate investment market?

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The first evidence of foreign investors coming back to Hawaii is the recent sale of Pacific Guardian Tower at the corner of Kapiolani Boulevard and Keeaumoku Street, near the Ala Moana Shopping Center.  This eighteen story high-rise office building was recently purchased by a Japanese investor (Maruito USA, Inc).  With the yen hovering around 90 per dollar, the Japanese buying power goes a long way for U.S. real estate.  Undoubtedly, the location and attraction of Ala Moana Shopping Center was a high priority for this investor.

In addition, since direct flights were announced to China we have had several inquiries from investors and real estate operating companies to purchase specific types of assets to service this new visitor coming to the islands.

With this first evidence of a new wave of investors, we will be looking east again, hopefully, for many of our investment real estate buyers.

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