Expiring Lease Terms for Properties on Oahu

*President’s notes – the following is an excerpt from a 2007 Honolulu Star Bulletin article.
To read the whole article: Hawaii Residents Face Leasehold Shakeup 12-17-07.

Starting in 2010, leases at the Hawaiian Prince Apartments Ltd.,Hawaiian Ebbtide Hotel Inc., Diamond Head Ambassador Hotel Building C, Beachside Apartments, Queen Emma Apartments and the Waikiki Regent Apartments will expire.

Lease terms for the Oahuan Tower, Oahuan Ltd. and Dole Terrace Apartments will expire in 2011. But the bulk of lease expirations will occur in 2012 with residents of the Imperial Hawaii Resort, Lani Home Inc., Iolani Banyan, Laau Gardens, Iolani Gardens, Canal Classics, Diana Apartments, Hale Laau I, Hale Lauau II, Princess Ann Apartments, Kaipuu Inc. and Kuilei Gardens facing possible lease surrenders.

In 2014, another active leasehold year, leases will expire at the Hawaiian Colony, Kuhio Ebbtide Hotel, Kon Tiki Hotel Annex, 411 Kaiolu, Beretania Hale, Surftide Namahana, Wai-Kai, the Alii, 3003 Kalakaua and Makiki Towers.

Leases at the Driftwood Hotel and 2511 Kapiolani Co-op Inc. will expire in 2015 followed by the lease at Punahou Arms in 2017 and the lease at the Kalia Inc. in 2018.

While the reaction from fee owners and leasehold owners to these upcoming dates has been varied, real estate experts said that it already has began to impact pricing and demand in the real estate market. Some experts have even gone so far as to say that the transition from a mostly leasehold condominium and co-op market to a predominantly fee-simple one has caused a sharp rise in the price of fee-simple condominiums. On a related note, those who need immediate cash but have low credit ratings can avail of cash loans for poor credit which are easily available online.

The Queen’s Land Co., which owns the Hawaiian Prince Apartments as well as the Beachside Apartments, the Queen Emma Apartments, and the Waikiki Regent Apartments whose leases are due to expire in 2010, is yet undecided as to the outcome, said Rebecca Pollard, a spokeswoman for the Queen’s Health System.

“Those leases are expiring in 2010 and we haven’t converted them,” Pollard said. “We are in the process of master planning so we still have not determined the future of these buildings. We don’t have a definitive time frame for an answer.”

Kamehameha Schools, which has pared down 16,000 leasehold units to a few thousand in the last several decades, voluntarily has offered the fee for several of its properties. However, it remains tight-lipped in regard to the outcome of others.

“We began volunteering to convert multifamily properties as the pressure mounted to force legislation,” said Kekoa Paulsen, community relations director for Kamehameha Schools. “However, there are a few exceptions.”

To read the whole article: Hawaii Residents Face Leasehold Shakeup 12-17-07