Puna Community Development Plan Adopted

Puna likely will have the first resident-written Community Deveopment Plan (CDP) in the State of Hawaii after the Hawaii County Council's Planning Committee endorsed the plan without major changes yesterday in Hilo.

About 50 Proponents of the plan staged a fine demonstration in a march on the County building for the benefit of Council members on their way into the Ben Franklin building before the 8:30 a.m. meeting in Hilo. These supporters were ecstatic following the meeting.

In an e-mail to members of the Friends of Puna's future, the group that spearheaded an effort to thwart the changes that would have substantially altered the work of the volunteers who wrote the plan, President Rob Tucker, who moderates the Punaweb forum and is vice president of the Main Street Pahoa Association, said the Planning Committee's vote marked a "cultural shift " in Hawaii County.

According to Hunter Bishop, after the eight-hour meeting Tucker said "I might describe it as a nail in the coffin of the Old Plantation Ways when people were afraid to speak up and the large landowners made the decisions."

The narrow 5-4 votes that squelched dozens of proposed amendments were largely made possible by Council members whose districts are in the process of writing their own CDPs.

Hamakua Councilman Dominic Yagong said he talked to people in his community who said they wouldn't want  their work altered after it was completed.

It’s official. The $300 Billion Housing Bill Passes.

Key elements of H.R. 3221, the Housing and Economic Recovery Act of 2008, include:

Tax Credit Centerpiece of Housing Bill

“The tax credit is the best stimulative measure,” said Dunn. “It will increase housing demand, get home buyers back into the marketplace and fight falling home prices, which threaten the economy as a whole.”

Will buyers come out to play? 

What’s it mean to you and me? It all depends on where you live and what your situation is.  One sure thing, although we are silly-putty pounded by media reports referring to the “National Housing Market”, there is no such thing. 

Real estate markets are local, hyper-local in fact. 

For example, the Phoenix, Arizona housing market in not like the Austin, Texas market.  Real estate sales and listing inventory in Stockton, California is not similar to San Francisco, California.  Miami Beach, Florida is not comparable to Houston, Texas.  Las Vegas is not the same as Hilo.

Hyper-Local means that in an area like the Puna District, real estate market activity will be different that the entire Big Island.  Inside Puna, the real estate market statistics are different from subdivision to subdivision, sales velocity, listing inventory, Days On Market and months supply of inventory also varies from individual neighborhood to neighborhood, street to street and even house to house.

What’s the take away? 

If you want to know where you stand, what your property is worth, how long would it take to sell, are prices going up or down, you will want to consult with your favorite, trusted Realtor.  They can research and create an up to the minute hyper-local statistical report (called a CMA or Comprehensive Market Analysis) and share their real-time perspective, what the data means and what their interactive experiences are with the real clients and customers in today’s market place.

Back to the Housing Bill.  It’s signed and it’s official.  In my opinion it’s a big deal for citizens buying and selling real estate.  Why?  Because it bolsters Fannie and Freddie Mac, which provides consumer and institutional confidence and the assurance of mortgage money availability.  It also raises the conforming loan limits from $417,500 to $625,500, providing lower interest rate loans to more people.  It provides a Tax Credit for first time home buyers. 

Bottom line, it provides confidence, security and cheaper mortgage money to more people, ergo consumers can buy homes at less expensive rates.  All good and positive.

Read the whole CNNmoney.com article - Click Here

Here’s the summary

A stronger regulator for the Government Sponsored Enterprises (GSEs). The new regulator will have a greater say over how well funded the two government sponsored enterprises (GSEs) are - a major concern in the markets that has sent stocks in both companies plunging in the past two months.

A permanent increase in “conforming loan” limits. The law will permanently increase the cap on the size of mortgages guaranteed by Fannie and Freddie to a maximum of $625,500 from $417,000. The FHA maximum loan limits for high-cost areas would also increase to a maximum of $625,500. Higher loan limits will make it easier for borrowers to get mortgages, because those mortgages are more likely to be traded if they are considered conforming.

A new home-buyer credit. The new law includes a tax refund for first-time home buyers worth up to 10% of a home’s purchase price but no more than $7,500. The refund, however, serves more as an interest-free loan, since it would have to be paid back over 15 years in equal installments.

A ban on down-payment assistance from sellers. The new law eliminates a program that has allowed sellers to provide down payment assistance for FHA loans. The law would also increase to 3.5% from 3% the down payment requirement for borrowers getting FHA loans.

A new affordable housing trust fund. The law establishes a permanent fund to promote affordable housing. The fund will be paid for by fees from Fannie and Freddie.

Bolstering Fannie and Freddie's late and controversial addition to the new housing law provides temporary authority for the Treasury to lend a financial hand to Fannie Mae and Freddie Mac if the Treasury deems it necessary to help stabilize markets.

Pineapple could vanish from Hawaii

Layoffs by Maui Land & Pineapple Co. may have put Hawai’i one step away from the complete loss of what was once the state’s single biggest cash crop.

ML&P’s pineapple production will drop by half, from about 2,000 acres to around 1,000 acres. Of the 274 jobs being cut, 204 are in the company’s pineapple division of 441 employees.

And if the drastic reduction doesn’t turn around the money-losing operation, then what’s left of pineapple production in Hawai’i could disappear.

"If we can’t make it work, we’ll have to leave the business," said Wes Nohara, general manager of agricultural operations for the Kahului-based company. "It’s a daunting task and a huge undertaking to salvage what we have. I’m not throwing in the towel. We’ve been here a long time and we’re going to do everything we can to make it work."

Some of the financial pressure to cut jobs is because ML&P is rooted in two other Hawai’i industries under stress — real estate development and tourism.

The company is the developer of Kapalua Resort, and has heavily invested in redeveloping parts of the resort. But the pineapple business in Hawai’i for years has been shrinking and claiming jobs.

Two years ago, Del Monte Fresh Produce quit farming pineapple on O’ahu, laid off 551 employees and ended operations in Hawai’i that had existed for more than a century.

ML&P hasn’t avoided such pressure. A decade ago the company employed 1,480 people in pineapple production and farmed about 6,000 acres.

High land and labor costs have made Hawai’i pineapple growers less competitive with producers in Costa Rica, Mexico, Ecuador and other countries.

ML&P thought it had a plan to ensure the viability of its pineapple business when it quit canning the fruit — a move that eliminated 120 jobs last year in favor of concentrating on the higher premium fresh pineapple market with its Maui Gold brand.

As part of the plan, the company began shifting growing operations from Hali’imaile in UpCountry Maui to Honolua in West Maui. The move, which is still in progress, was envisioned to take advantage of better growing conditions, shorter growing cycles and lower operating costs in Honolua and free up land in Hali’imaile for development.

But skyrocketing oil prices made it more costly to transport pineapples from Honolua to a processing facility in Kahului. Higher fertilizer demand in Honolua also became more costly.

Doug MacCluer, a former Maui Pineapple vice president and agronomist who retired in 2002 after 39 years with the company, called the move a big mistake.

"This didn’t have to happen," he said of the layoffs. "They chose to sell off the best farm land they had."

Nohara said the relocation plan turned out to be unfortunate but that soaring oil prices couldn’t have been anticipated. "In hindsight I’d say we made some bad decisions," he said.

Diversifying Crops

The strategy now with downsized pineapple is to primarily serve local markets and a "handful" of Mainland accounts.

Nohara also said more efforts are being made to further diversify crops beyond 200 acres of organic farming that include pineapples, vegetables and free-range chickens. There are also plans to plant 500 to 600 acres in koa as a forestry crop that could be harvested in about 30 years.

Another potential large-scale crop is plants for ethanol production, which ML&P is exploring through a partnership with other large landowners, including Kamehameha Schools and Grove Farm.

Reducing pineapple production is forecast to save ML&P $11 million in annual operating costs minus a one-time cost of $3 million for employee severance costs.

Operating losses in agriculture last year totaled $26.6 million for the company, up from a loss of $18.6 million a year earlier.

Real estate development and resort operations helped the company achieve a net profit of $8 million last year and $7.2 million in 2006.

During the first quarter of this year, ML&P reported a net loss of $740,000, largely driven by an agriculture operating loss of $5.6 million. Resort operations posted a $2.3 million operating loss, while real estate development had an operating profit of $8.2 million, which was down from $29.1 million a year earlier.

Multiple Challenges

Paul Brewbaker, chief economist at Bank of Hawaii, said many Hawai’i companies are having more trouble staying in the black because of the state’s economic slowdown, but that ML&P faced challenges on multiple fronts.

"It’s going to be difficult for somebody in that part of the economy to thrive right now," he said.

Brewbaker said Maui and the Big Island have suffered the biggest reductions in airlift from the Mainland because of the shutdowns of Aloha Airlines and ATA airline earlier this year.

ML&P and its partners recently renovated the Ritz-Carlton Kapalua hotel at a cost of $160 million, which in part was financed by selling 107 suites in the 463-unit hotel as condominiums to individual buyers.

The company also is developing a luxury time-share project with partners on the site of the former Kapalua Bay Hotel. Several other Maui Land & Pine real estate development projects are planned, though most are still subject to permitting.

 

Young Brothers adds new Big Island of Hawaii Barge

Young Brothers Ltd,  Hawai'i's largest interisland cargo company, has added a new barge to its fleet for services between Honolulu and the Big Island of Hawaii.

Hawaii's largest inter-island cargo company announced the addition of the Makaala, a nearly $12 million freight barge with the capacity to move 8,600 tons of cargo.

On Sunday, the Maka'ala, which cost nearly $12 million and has a cargo capacity of 8,600 tons, is scheduled to begin transporting cargo between Honolulu Harbor and Kawaihae Harbor, on Hawaii Island.

This is the third time a vessel has carried the Maka'ala name — which means alert and vigilant — in Young Brothers' 100-year history.

The addition of the barge, along with November's addition of the Hoomaka Hou, is part of a $186 million investment announced in 2006 to provide better service and more benefits to Hawaii.

The company said the barge is fuel efficient and environmentally sensitive. The hull design provides for less resistance, resulting in faster towing speeds and less fuel consumption and the internal ballast system uses fresh water and no discharge is pumped into the ocean.

The 3,175-ton Maka'ala was built in Portland by U.S. Barge, which is a joint venture between Oregon Iron and Vigor Industrial. Young Brothers has contracted U.S. Barge to provide two more barges of the same design over the next year.

A third vessel, the Kala'e Nalu, is scheduled to be delivered in November, with a fourth barge to be delivered in April 2009. All of the barges are being constructed on Swan Island in Oregon, a shipyard that built "victory" ships during World War II.

Young Brothers, Limited has been providing inter-island cargo service since 1900 throughout the State of Hawaii with ports in Honolulu, Maui, Molokai, Lanai, Hilo, Kawaihae, and Kauai.

Young Brothers' parent company, Saltchuk Resources, bought the cargo division of bankrupt Aloha Airlines in May 2008 for $10.5 million.