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 Quietly located at the top of Ahekolo in popular Kilohana Ridge. Perched on a huge lot with plenty of room to expand and develop an outdoor kitchen and entertainers gathering spot. The kitchen has been renovated with expansive bar, Fisher paykel dishwashers, microwave oven plus heating drawer and cabinet depth refrigerator. Gorgeous Jarrah wood floors, home beautifully maintained. This is a four or possible five bedroom four bath home. Fifth bedroom could serve as second master suite presently being used as an exercise/media room. Broker owned and occupied, easy to show. 

Contact Bob Hansen, BROKER, 808-283-9456 or

Donna D. Hansen, Realtor (S) 808-280-1650

Lender wins bid for troubled Ritz-Carlton

Lehman Brothers will aim to maintain the foreclosed Kapalua luxury resort’s value

By Kristen Consillio
Article from: Star-Advertiser

Lehman Brothers Holdings Inc. topped two other qualified entities with a $75 million credit bid to claim the 404-room Ritz-Carlton Kapalua.
The lender for the Ritz-Carlton Kapalua scooped up its investment in a foreclosure auction yesterday on Maui, with a $75 million credit bid on the luxury hotel.

Lehman Brothers Holdings Inc. outbid two other qualified bidders for the 404-room luxury property, which was foreclosed in September after institutional investors and Maui Land & Pineapple Co. defaulted on a loan, most recently valued at $268 million.

Lehman Brothers filed for bankruptcy in September 2008 and is in the process of being liquidated.

The auction was held at the state courthouse building in Wailuku with local real estate executive Chris Lau serving as foreclosure commissioner. A confirmation hearing by a Circuit Court judge hasn’t been scheduled. It is possible for a judge to reopen bidding if someone offers 5 percent above Lehman’s bid, Lau said.

“I think it’s a good possibility,” he added.

However, if the bid is confirmed, the investment banking firm will focus on ensuring the hotel continues to operate and the value of the property is preserved, according to Barry Sullivan, an attorney for Lehman.

“When lenders take a property back, they’re looking to maximize the value for it to try to recover their loan,” he said. “The idea is to do what’s in the best interest of the property so that we can do the best we can to recover the investment that was made.”

While the five-star hotel is a high-quality asset, it carries significant debt, so the lender will likely wait for the property’s value to rise and sell it when the market’s stronger, said hotel consultant Joseph Toy.

“The lenders don’t really want to be hotel owners,” he said.

“At some point in time they’ll want to sell the asset,” likely in a private sale where the owner can get more value through negotiations, he added.

Like other hoteliers, the Ritz-Carlton’s owners fell into trouble when the downturn in the economy and real estate market hindered sales of 107 residential condominium units.

Condominium sales were to pay down debt accrued for a $180 million renovation in 2008. Lehman initially issued $232 million in loans to finance the renovation and condominium conversion plan.

If no other bidders emerge at a confirmation hearing, Lehman would be in a position to resume condo sales efforts or restructure the existing operating plan.

Yesterday’s auction included the bulk sale of 73 unsold condo units, 297 hotel units, common areas, commercial space and 21 acres of undeveloped land.

The Ritz-Carlton Kapalua was built in 1992 by Japan-based Nissho Iwai Corp., Ritz-Carlton Co. and Maui Land for $206 million.

Kona company starts algae-to-oil production

Cellana says it will be able to make 3,800 gallons of oil per acre annually for biofuels

By Alan Yonan Jr.
Article from: Star-Advertiser
Cellana’s 6-acre facility at Keahole Point in Kona is capable of producing up to 60 tons of oil-rich algae a year. Cellana’s goal is to produce 3,800 gallons of oil per acre per year to be used for biofuels, animal feed, cosmetics, nutritional oils and industrial chemicals.

Cellana Inc. said it has begun producing oil from algae grown at its Kona facility and is on track to begin commercial production by 2014.

The Big Island company is harvesting up to one ton of algae a month in ponds at its 6-acre facility at Keahole Point. The company estimates it will be able to grow up to 60 tons of algae capable of producing 3,800 gallons of oil per acre per year.

The oil can be refined into a variety of products, including biodiesel for automobiles and power generation plants. Other uses include animal feed, cosmetics, nutritional oils and industrial chemicals.

Oil-rich algae is considered an attractive crop for biofuel production because of its relatively high yield compared with other crops. Algae can produce up to 11 times more oil per acre than the oil palm nut, the next-highest yielding feedstock, according to the U.S. Department of Energy. Algae yields are as much as 145 times higher than soybeans, the department said.

“Over $100 million has been invested to date in our Kona demonstration facility, our algae strains and the process we use to grow, harvest and separate our algae biomass, which puts Cellana on a very short list of leading companies in the emerging algae-based biofuels and bioproducts industry,” said Martin Sabarsky, Cellana’s chief executive office.

Cellana’s parent company, Cellana LLC, last month changed its name from HR BioPetroleum, which was founded in 2004. HR BioPetroleum in 2008 signed a memorandum of understanding with Maui Electric Co. and Alexander & Baldwin Inc. to develop a commercial algae facility on land next to MECO’s Maalaea power plant.

“It is a pioneering effort with tremendous potential, and we are now looking at 2014 for the construction and operation of this transformational facility on Maui,” Sabarsky said.

Cellana also announced yesterday that it has received a $5.5 million federal grant to develop animal feed from the algae grown at the Keahole Point facility.

The grant from the U.S. Department of Agriculture will be combined with $1.6 million raised by Cellana for the project titled “Developing a new Generation of Animal Feed Supplements,” according to a news release from the office of U.S. Sen Daniel Inouye.

The project began Sunday and runs through April 30, 2014.

The senator praised “Cellana’s efforts to move Hawaii away from the use of imported fossil fuels while developing innovative new products form one of our most readily available resources.”

Hotel numbers look good despite Japan lag

Japanese arrivals to Hawaii declined after the March quake and tsunami

By Allison Schaefers
Article from: Star-Advertiser
All measures of Hawaii hotel performance increased in March, despite a strong downturn from Japanese visitors after the March 11 earthquake and tsunami.

Statewide hotel occupancy increased 4.8 percentage points to 75.2 percent, according to a report released today by hotel consultancy Hospitality Advisors LLC.

The increase would have been larger if not for the tragedy in Japan. Japanese visitor arrivals to Hawaii were down 18.7 percent in March. The drop was felt most at Oahu hotels, since Waikiki is the primary destination for Japanese visitors.

“Occupancy at Oahu’s hotels had been exceeding 2010 levels up until March 11,” said Joseph Toy, president of Hospitality Advisors. “In the aftermath of the events in Japan, Oahu’s daily occupancies trailed the previous year’s levels during most of the remaining days in March.”

Even with the decline in the last half of March, Oahu’s hotel occupancy grew by 3.4 percentage points to 79.2 percent, the highest occupancy in the isles.

On Maui, occupancy rose 6.5 percentage points to 78.7 percent. Big Island occupancy climbed 5.9 percentage points to 63.4 percent. Kauai’s occupancy rose 6.1 percentage points to 62.2 percent.

Jack Richards, president and chief executive of Pleasant Holidays LLC, the state’s largest wholesaler, said the booking pace for vacation packages that included Hawaii hotel stays was very strong until March 11.

“Bookings slowed for the remainder of March and began increasing in early April,” Richards said.

More visitors from the U.S. West, U.S. East and Canada helped offset the drop in Japanese arrivals and keep room rates moving higher.

The statewide average daily rate (ADR) paid for a hotel room increased more than 9 percent in March to $190.15. Revenue per available room (RevPAR), considered by many to be the best measure of hotel performance, was up nearly 17 percent to $142.99.

The state did well in the first quarter despite the Japanese decline in March.

For the first quarter, Hawaii’s $147.05 RevPAR was the highest in the nation. Hawaii’s 77 percent hotel occupancy during the first quarter was the second highest in the nation behind Miami, and the state’s $190.99 average daily rate trailed only New York.

David Kong, president and chief executive of Best Western International, which operates two hotels in Honolulu and one on Maui, said the brand’s Hawaii hotels are doing well this year.

“The two here on Honolulu are both up tremendously this year,” Kong said. Hawaii will continue to be a sought-after destination, he said. “The aloha spirit is the most important element of Hawaii’s success,” Kong said. “It’s very difficult for any other destination to duplicate.”

With occupancy improving, hotels are able to charge more for rooms.

The average daily rate on Oahu was $156.42, an increase of more than 9 percent from the previous year. Likewise, RevPAR increased about 14 percent to $123.88 from $108.76 a year ago.

On Maui the average daily rate rose about 15 percent to $265.94, and RevPAR increased about 25 percent to $209.29. Kauai ADR increased more than 7 percent to $201.18, and RevPAR grew about 19 percent to $125.13.

Big Island RevPAR rose about 4 percent to $109.11; however, ADR fell by about 6 percent to $172.09. The tsunami-related closures of the Kona Village Resort and the Four Seasons Hualalai, which just reopened, on the Big Island likely contributed to the decrease in ADR.

Isle bankruptcies continue to drop

The first four months of 2011 have shown a 6 percent decline, a sign of stabilization

By Alan Yonan Jr.
Article from: Star-Advertiser
The number of bankruptcy cases filed in Hawaii fell in April for the fourth time in five months, setting the stage for what could be the first yearly decline in bankruptcy filings since 2006.

U.S. Bankruptcy Court said 342 cases were filed in April, 12.5 percent fewer than the 391 cases filed the same month a year earlier. With the exception of a scant 0.3 percent increase in March, bankruptcy filings have declined on a year-over-year basis in every month since December.

With bankruptcy filings still averaging more than 300 a month, however, there are still a considerable number of Hawaii residents and businesses trying to dig themselves out of debt accumulated during the recession that officially ended in the summer of 2009.

Still, the gradual reduction in filings shows that “things are definitely stabilizing at a minimum,” said David Farmer, one of three federal bankruptcy court trustees operating in the District of Hawaii.

An improving economy appears to be having a positive impact on household finances, he said. “It’s premature to say we are out of the woods, but the trend is going in the right direction,” Farmer said.

Bankruptcy filings through the first four months of 2011 are running 6 percent behind the year-ago pace, making a decline for the entire year a distinct possibility.

“It may not be a huge decline, but we have a good shot at it,” Farmer said.

The bankruptcy court figures show that Oahu had the biggest decline in April cases, dropping to 203 from 250 the same month a year ago. The number of cases filed on Maui fell to 69 cases from 70, while filings on Kauai fell to 23 in April from 24 a year earlier. Big Island filings were unchanged at 47.