On Top of the Aloha Beat BLOG

The Islander on the Beach is a 198 unit condominium/hotel AKA condotel located on the east shore of Kauai in Kapaa, just behind the eclectic Coconut Marketplace shopping center. Anekona Management bought the property in 2003 and did a total facelift of the property. The developers then sold the units in 2004 and 2005.

One investor purchased 10 of these units oceanfront and that investor is now selling the condotel units in fractions, or two-month segments for around 70,000 per two month segment. That is FEE SIMPLE ownership on Kauai, on the ocean, for two months for 70K. Since the units, hotel rooms basically, are in the Visitor Destination Area, an owner can choose to rent them him/her self when they are off island or put the unit in the Resortquest Hawaii pool. ResortQuest currently manages 90% of the units in the condo complex.

Fractional ownership is coming of age in the islands. Island Fractional Homes is a nice site by a developer who has taken the time and spent the money to help educate the buying public with regards to the benefits and the nature of fractional ownership.

If you need any materials about fractional ownership or have any questions, I would be more than delighted to answer them or get you answers that i might not know.

There's an interesting property for sale out in Haena that may provide a great investment opportunity for someone who values the North Shore of Kauai and doesn't mind a little bureaucratic challenge. This home in Haena is seven bedrooms and six and a half baths. It's currently 5 rentals. The main home rents for 3K a week and the other units for less. If a large group wants to rent the entire property , it rents for 5-7k a week.

The property is currently assessed at 2.482 Million. While the listing is at 1.7M, i believe you could buy it for less if you are patient enough to deal with the bank. The owners are upside down and are clearly walking from the property.

The challenge is the fact that the home is in the non VDA location and thusly, the owner must submit an application for a non conforming use certificate (NCUC) by September 15, 2008. Submitting the application requires proof of prior rental history, architects and engineers stamped plans, and filling out an application. Not too bad. However, we'll need to ascertain from the county of Kauai, what is legal and permitted and everything else, including several of the downstairs rentals, would need to be brought up to code, which probably means pulling out kitchens and plumbing which are not permitted. You need to know that maintaining a large home on the North Shore of Kauai close to the ocean is a big resposibility. The salt walter and winds provide wear and tear such that the home must be regularly maintained.

I'm not a contractor so I'm not sure what the cost of the demo work would be. Even if it is 100k ( and i do not believe it would be) the property still has solid value. PLUS, I've been speaking to the former property manager who has rented the property for 12 years. The manager loves and believes in the property and this property manager would be a great resourve for any buyer.

If you have any interest in pursuing this type of home, I'd be happy to guide you through the challenges of this unique property and the intricacies of a short sale on Kauai.

I am having my first experience of managing an escrow on an oceanfront condo complex on Kauai. I've just learned that a couple of owners are suing the homeowner's association for some water damage from a leak the owners feel is the association's fault. There was water damage and I am sure that those couple of owners are upset and want some remuneration.

The difficulty arises for any other owners that happen to be engaged in selling. When a condo association provides what we in Hawaii call the RR105C, the condo must disclose the nature of the complaints. Since the actual damage of the complaint/suit is unknown, lenders seem to be pretty unwilling to consider a loan on the project due to the unknown nature of the legal complaint/suit. In this case,  I am hopeful that the association's insurance company will resolve the issue. Short of that, we have asked for an opinion letter from the attorney representing the condo association.

The association wants us to pay for the opinion letter. Not sure how fair that is to my seller but that remains an option should the complaint not be resolved. It's quite eye-opening when a dynamic like this comes into play and an innocent seller is unfairly effected by the actions of some of his fellow owners. Have have you been able to deal with this issue when it's shown up?

Inquiring minds want to know.

I had the opportunity to sit open house at Kaiulani Unit 2 today. This project consists of 77 luxury townhomes built on the last 17 acre bluff parcel in PRinceville which was NOT OWNED by Princeville at Hanalei (formerly the Princeville Corporation).

The project is almost totally completed. Most of the units have sold and about 8 of the units are still being completed. The pool complex with 3 pools and barbecues and fountains and water features is complete. I am so impressed with the quality of the construction, the superior engineering and ergonomic designs, and the simple class of these units.

Today while sitting in Unit 2, a fully furnished 2800+ sq. ft unit which is selling for 2.195 Million, i had about eleven or twelve folks folks come through. That's brisk attendance for a weekday in Princeville. One family said they were looking under a million if possible so i brought them over to Unit 59, which is listed for 995K. This unit actually had very nice ocean views albeit a little smaller in size. Unit 59  is around 1900 sq. ft. It still has all the high end amenities which include solid granite slabs on all counters, and wolf range, sub-zero refrigerator, and  well, you get the idea.

If you are looking for a Princeville condo, you need to be aware of how Kai`ulani stacks up against the existing inventory, most of which was built in the 70's. And, Kai`ulani stacks up very well. The units that face this vast valley and white water ocean views are selling for 2.5 million. Not too bad when you consider all the Princeville bluff homes that were built in the prior decades are selling for over 3M.