Two top commercial real estate sales close in West Maui
WEST MAUI – Halfway through 2013, the recession seems to be a thing of the past for Maui commercial real estate. New Central Maui properties are coming on the market – both fee simple and for lease in all categories – and two major commercial sales recently closed on the West Side.
Other sizable ventures are beyond the talking stage, including The Outlets of Maui under construction in the former Lahaina Center space at 900 Front St.
Maui’s first outlet mall will reportedly host high-end retailers Coach, Brooks Brothers and Calvin Klein, as well as Adidas, Carters, Guess and Perfumania.
The Hard Rock Cafe, Ruth’s Chris Steak House, Hilo Hattie, Warren and Annabelle’s Magic Show, ABC Stores and Cold Stone Creamery will remain at the revamped center, which is slated to open this summer.
The two top commercial real estate sales on the island in May were in West Maui.
The leading property, selling for $19 million, was the Napili Plaza Shopping Center near Kapalua.
The retail complex consisting of over 40,000 square feet was purchased by Alexander and Baldwin.
Coming in second was a bulk purchase of 13 office condo units in Lahaina’s Keawe Business Center Offices for $2.1 million.
Mario Cardone, a broker affiliated with Peake & Levoy Real Estate Services, represented the buyer in the transaction.
He said his client, a West Coast developer, intends to re-list the units individually “at market.” The buyer paid cash.
The office complex was recently constructed in the new Lahaina Business Park above Honoapiilani Highway.
The building went into foreclosure and had been taken back by First Hawaiian Bank. Alan Yap at CBRE-Hawaii represented the seller.
Like residential real estate, the bottom has passed on the commercial side, and the outlook seems a little brighter. But professionals are reluctant to say it will last.
In a June conversation, Cardone put forward a more modest goal of recovering prices set in 2007-08.
He also said that for owner-buyers, the numbers often pencil out more favorably to buy than to lease. He said cost to buy could sometimes be as much as 20 percent less than replacement value.
Commercial loan rates, always higher and shorter term than residential, have already bumped up, and appraisals are still coming in low.
Those without cash or significant existing equity are still finding it hard to qualify for loans of any kind. Other less traditional financing options are still available.
There is still ample – if no longer deliciously cheap – leasing inventory available. Terms are no longer as flexible as they have been in recent years.
Lease rates in West Maui rank on the high side. Rates on Front Street are said to be on par with those in Times Square in New York City.
Interested in following Maui commercial leasing and sales? Two good links are the Commercial Round Table of Maui, a local site, and Loop Net, a national website devoted to commercial real estate of all kinds.
An informal organization, the Commercial Round Table of Maui (mauicommercial.com/index.php) is made up of commercial realtors and their service providers. Dues are $75 per year.
The group meets on the third Thursday of most months. A different property is showcased at each meeting. Their website also shows a list of members and displays present inventory for lease and sale.
Loop Net (www.loopnet.com/) is a national commercial real estate website. Most commercial realtors use it and browse it.
It will often show properties that do not appear on the MLS or do not have a sign posted. Most of the site is free, but registration is necessary, and there is a fee to see selected properties.
(The writer is a licensed Hawaii real estate broker.)