HOW TO PLUCK A BILLIONAIRE!
(But be careful that the Plucker doesn’t become the Pluckee!)
Sightings from The Catbird Seat
~ o ~
March 22, 2007
Kawamoto welcomes tenants
The Japanese mogul is renting his
Kalaha homes to needy families
Nina Wu, Star-Bulletin
Japanese billionaire Gensiro Kawamoto began handing over the keys to his first Kahala home rentals this morning.
The Kahale, Worley and Gusman families began receiving the keys to Kawamoto-owned homes at 4398, 4578 and 4337 Kahala Ave.
Kawamoto had said he plans to rent the homes out for between $100 and $150 a month, not including utilities.
But this morning he said he plans to let at least the first family to receive the keys, Dorie-Ann Kahale and her six children, live in their new home rent-free.
“I just want to thank the lord for everything and for Kawamoto.” said Kahale, who had been living in a homeless shelter at Kalaeloa while working as a customer-service representative for Pacific LightNet. “I just hope the neighbors accept us.”
The second family to get keys this morning is headed by Lyn Worley, a divorced mother of three who works as a clerk for the state Department of Education. She said a friend wrote to Kawamoto on her behalf.
Worley said the lease on her Waianae apartment expires this month.
“One door closes and another opens,” she added.
Kawamoto says he intends to lease eight to 10 more of his homes in the tony neighborhood later on.
He had announced earlier that he intended to rent the homes out to low-income families, preferably Native Hawaiian.
Kawamoto set up a post office box and received more than 3,000 letters from interested tenants.
Calling it his “Kahala Avenue Mission,” Kawamoto said he intends to rent to hardworking families with children that are having a hard time making ends meet.
Kawamoto, the head of a commercial real estate empire based in Tokyo, Marugen Building Co., began investing in Kahala Avenue homes in 2002.
He owns about 20 properties, most of which he acquired in the last 21/2 years for $2 million to $3 million each.
He also plans to convert a handful of homes on the makai side of Kahala Avenue into museums for his personal art collection.
March 30, 2007
Billionaire's Gift Stirs Distrust
Some Hawaiians See Bid
To Undermine Home Prices;
'A Weird Reality Show'
By Robert Frank, The Wall Street Journal
In Hawaii's exclusive neighborhood of Kahala, wealthy residents generally keep to themselves inside gated estates and beachfront mansions. But last week, they couldn't help but notice their newest neighbors: a group of homeless Hawaiian families.
In one unusual experiment between rich and poor, a reclusive Japanese billionaire has handed the keys to three of his multimillion-dollar houses to needy Hawaiian families. The billionaire, Genshiro Kawamoto, told the local press that he hoped the gift would offer hope and opportunity to families who had little of either. He also said his experiment would encourage Kahala's rich to reach out to homeless families and give them jobs and assistance.
The families were chosen from more than 3,000 people who wrote to Mr. Kawamoto hoping to be chosen for the houses, which he purchased during the past two years. They will pay no rent and be responsible only for maintenance. Mr. Kawamoto, who retains ownership of the houses, has said he may offer eight or nine homes in total to homeless families in coming months.
"They will be living in heaven now," Mr. Kawamoto said as he handed over the keys to a $5 million, five-bedroom mansion to a homeless family last week. "Affluent people can help the least affluent people."
Yet while many Hawaiians are celebrating Mr. Kawamoto's gift, others are dubious. Mr. Kawamoto has spent an estimated $130 million to buy more than 20 houses in Kahala, a hushed Honolulu neighborhood of Tudor beach mansions and rolling estates that's considered the Beverly Hills of Hawaii. Mr. Kawamoto hasn't said what he plans to do with the properties, other than provide the homes for the homeless and perhaps open a museum or two for his art collection.
But some worry that the eccentric real-estate magnate -- better known for evicting low-income tenants than offering them free rent -- may be using the homeless to drive down property values. They say Mr. Kawamoto, an avid land speculator, plans to buy more Kahala houses at a discount so he can later sell them for a bigger profit.
"He may be trying to knock down prices so he can pick up land more cheaply," says Richard Turbin, an attorney who lives in Kahala. "I'm sure the homeless families are lovely people. But this is a recipe for disaster."
At the very least, it's a recipe for a culture clash between those at the top and bottom of Hawaii's extreme wealth gap. In his statements, Mr. Kawamoto said he hopes the families will bring a more "local" feel to the neighborhood, which is dominated by vacation homes for out-of-towners. Mr. Kawamoto says he wants more singing, dancing, parties and "Polynesian flair." He's calling his new homeless settlement the Kahala Ave. Mission.
"It's going to be my extended family," the media-shy Mr. Kawamoto told reporters. He declined to answer questions emailed to his attorney.
Kahala residents don't know quite what to make of their new neighbors. Some have started driving or walking past the homes to gawk at the new families, who are often out playing in the yards. Others are commenting on the homes' swimming pools, which Mr. Kawamoto had filled in with rocks to lower the maintenance costs. On an island where gardeners can cost $20 an hour and plumbers charge $200 just to show up, some locals wonder how the poor families will be able to foot the remaining maintenance bills.
"Putting these families in Kahala is like a weird reality show," says Joanne Lundstrom, chief executive of Mental Health Kokua, which provides services to the homeless. "It will be interesting to see what happens when these kids start going to school with the Kahala kids."
Some of the wealthy aren't waiting to find out. Carl Smigielski, a Kahala real-estate agent, says one of his clients pulled out of a deal to buy a $2.5 million house in Kahala after he heard about Mr. Kawamoto's plans.
Other real-estate agents and some homeless advocates say that if Mr. Kawamoto truly wanted to address Hawaii's growing homeless problem, he would sell the Kahala homes and build low-cost houses in the island's less affluent areas with the proceeds. With Hawaiian real estate now among the world's most expensive, low-income residents are increasingly forced to live in tent communities at beaches and parks.
"If he invested, say, $15 million in structures that weren't so high end, you could accommodate more people," Ms. Lundstrom says.
One reason locals are so skeptical is Mr. Kawamoto's past. Mr. Kawamoto, the son of a kimono maker who once owned more than 50 nightclubs and bars in Tokyo, became the poster child for Japanese land-grabbers in Hawaii during the late 1980s. He was famous for trolling the streets in his "Kawamotomobile" limousine to buy properties on the spot for cash.
He scooped up more than 150 homes in Oahu, which later fell into disrepair and became a blight. Mr. Kawamoto said it was the job of his property managers to maintain the houses, but the managers say he refused to authorize necessary repairs. He sold many of the houses in 2002.
Mr. Kawamoto also bought more than 400 homes in Northern California in the late 1980s. Yet in 2002, he notified hundreds of his tenants that they were being evicted and had 30 days to leave. The move sparked such an outcry that the state passed legislation forcing landlords to give tenants at least 60 days notice before an eviction.
But for now, there's little the Kahala residents can do to oppose his homeless plan. "We can only make sure he follows all the health and building codes," says Mr. Turbin, the attorney. "There's no law that says you can't rent your homes to homeless people."
March 23, 2007
Kahala neighborhood has mixed reaction to Kawamoto
Not all residents are happy with his letting families live
rent-free in three nearby homes
By Nina Wu, Star-Bulletin
The neighborhood had a mixed reaction to the three low-income families that moved into rent-free multimillion-dollar Kahala homes yesterday.
Some neighbors said Kawamoto was being a generous man, while others called it a publicity gimmick and suspect an ulterior motive.
Japanese billionaire Genshiro Kawamoto carried out the first step of what he dubs his "Kahala Avenue Mission" by handing keys to three families from the Leeward side.
The Kahales, Worleys and Gusmans will be moving in over the next few days....
But some residents, including Anita Bruhl, who sits on the Kahala Community Association board, are livid.
"If these people do not maintain the properties, he will have the full force of the neighborhood coming down on their heads," said Bruhl, also a Realtor with Mary Worrall Associates. "We're going to watch him like a hawk."
Carl Smigielski, principal broker of Sandwich Isles Realty, said a potential buyer changed his mind about buying a Kahala home after reading about Kawamoto's plans.
"Watch out," said Smigielski. "This man is not who he says he is. The bottom line is, how can you say, Hawaiians only need apply."
Richard Turbin, a member of the Waialae-Kahala neighborhood board, said residents have voiced concerns about Kawamoto.
Kahala's property deeds come with covenants requiring that residential lots be landscaped and kept neat and attractive.
"The main thing is we want him to maintain the property," said Turbin. "If he's going to be a good homeowner, he can't just put tenants in the houses and walk away... He has a track record of buying property and letting it become fallow."
October 11, 2006
BILLIONAIRE BACK IN THE HEADLINES
Gensiro Kawamoto says he plans to rent Kahala homes
to Hawaiians for $200 a month
By Nina Wu starbulletin.com
Gensiro Kawamoto has a new vision for Kahala: Transform the high-priced locale into a neighborhood with more native Hawaiians.
The Japanese billionaire, who has invested in 18 homes on upscale Kahala Avenue, mostly in the last two years, says he now intends to rent them out to native Hawaiian families for between $150 to $200 a month.
Community response so far is mixed, with some believing Kawamoto is simply conjuring up outrageous ideas, while others hoped he was offering the low-priced rentals with sincerity.
"I'm not joking about it -- it's a sincere plan," Kawamoto told the Star-Bulletin through an interpreter.
Kawamoto, 74, said he's had the vision for four years.
Since 2002, he's been quietly investing in the Kahala area, buying the bulk of his homes in the last two years for anywhere between $2 million to $20 million apiece. His 18 Kahala Avenue homes -- a mix of oceanfront and mauka-side properties -- are worth more than $100 million combined.
Another five to eight oceanfront homes, including the former Hemmeter estate he bought last year, would be converted into museums to showcase Kawamoto's art collections, which include ceramics, Asian art, and European antiques.
Kawamoto offered no timetable for when the homes would be rented out, nor who would manage them, but said he was waiting to see what kind of response he would get.
He doesn't plan to make any significant upgrades to the homes because they are ready to rent now, he said. He outlined five- to 10-year lease terms for tenants. He expects tenants to take good care of the properties, he said.
His ideal renters would be large, low-income native Hawaiian families that are having a hard time finding a place to live in the state's high-priced housing market. They could invite their friends and relatives over and throw a beach barbecue on the weekends, he said.
"I'd like to honor what native Hawaiians say, that this used to be their land," he said. "We should honor their land."
The avenue, he said, has become "a luxurious place for the special people."
However, Kawamoto may run into a few walls when it comes to specifying what race or ethnicity he wants to rent his homes to.
The federal Fair Housing Act prohibits advertising or making any statement indicating a limitation or preference based on race, color, national origin, religion, sex, familial status or handicap.
Nonetheless, Kawamoto's vision involves 10 lots lined up next to each other to create one huge property, which would be rented out.
He wants to create a "better and fun community." He also said he wanted to promote Hawaiian and tropical gardens.
"In order to make this beautiful street, all the houses and gardens will be lit up in the evening so that people can enjoy the view at their own leisure," he said.
He's not finished with his investments yet -- he's hoping to own up to 25 homes on Kahala Avenue worth up to $200 million, which will come out of his own pocket.
He told the Star-Bulletin he does not plan to sell the Kahala homes.
"My focus in Hawaii is not about making money," he said in a written statement. "My real business is in Tokyo. Hawaii is a place for me to release my creativity. Since this is what I enjoy doing, I spend a lot of time thinking about my plans in Hawaii. I have decided to focus my energy on Kahala Avenue and now I want to continue to enjoy fulfilling my plans here."
Clyde Namuo, Office of Hawaiian Affairs administrator, said the concept, at least, is welcome.
"Considering that Hawaiians make up so many of the homeless and those in need of affordable housing, anyone providing opportunities for native Hawaiians, we would certainly commend," Namuo said. "I just hope it actually comes to fruition."
The Japanese real estate tycoon has made previous attempts to develop middle-class housing in Hawaii, ranging from a Kakaako high-rise to a 900-home subdivision on the slopes of Haleakala on Maui.
He blames bureaucracy for blocking him from completing those projects.
Kawamoto, once named on Forbes' list of richest people, has been called eccentric and erratic. He's never been married, nor does he talk much about his family.
"Women are very difficult to get along with," he said.
He spends about half the year in Hawaii, the other half in Japan.
Though he's laid out his visions, Kawamoto did not specify how he would implement his plan, saying only that he would proceed carefully and follow the law. He isn't keen on collaborating with city or state agencies.
Any museum in a residential neighborhood would require special approval through a conditional use permit, according to Henry Eng, director of the city Department of Planning and Permitting.
If it's along the shoreline, a museum would also need a special management area permit.
Kahala has its own separate covenants that allow residential lots to be occupied and used for residential purposes only.
The 1,700-member Kahala Community Association, an active group of residents, keeps a vigilant eye on covenant violations.
"Here's a person who could be well intended," said Lucinda Pyles, a neighborhood member speaking as a Kahala Avenue resident. "But if he is sincere, it would seem to me there are venues for him to do what he wants to do in a much better way."
August 20, 2006
This time, Kawamoto is
The oft-maligned Japanese billionaire has bought more than $100 million worth of properties in the affluent neighborhood
By Nina Wu, Star-Bulletin
Gensiro Kawamoto has a new nickname these days -- King of Kahala.
In the last 24 months, the Japanese billionaire has quietly invested in more than 15 homes on Kahala Avenue amounting to more than $100 million in property investments.
While some are simple old-style Hawaiian homes valued at about $2 million, others are oceanfront mansions priced up to $20 million. His most recent acquisitions include the home at 4631A for $19.8 million in February, and the home at 4585 Kahala Ave. for $9.7 million in March.
The latest transactions appear to be a shift from investments in Hawaii Kai and Portlock to Kahala, done primarily through tax-free 1031 exchanges. Neighboring homeowners worry that Kawamoto, who's developed a reputation as a neglectful landlord, will leave the Kahala mansions in similar disrepair.
The Japanese tycoon has developed a reputation of putting the minimal amount into property maintenance and upgrades. But whether he can get away with it in an upscale neighborhood like Kahala remains to be seen.
During the late 1980s, Kawamoto randomly acquired up to 200 Hawaii homes and properties, but left many in disheveled state during his absence for 10 years. He blamed his property managers for not keeping him informed.
Neighbors and former tenants said Kawamoto let the properties, and their problems, fester.
What Kawamoto plans to do with all of his Kahala investments remains unclear.
Kawamoto, a citizen and resident of Japan who lives part of the time in Honolulu, could not be reached for comment. His attorney, John P. Manaut, of Carlsmith Ball LLC declined comment without permission from his client.
Realtors specializing in the Kahala area speculate that he could sit on the homes for another five years, or sell them off in increments.
It's hard to go wrong with Kahala, according to Anita Bruhl, veteran Realtor and a vice president at Mary Worrall Associates.
Kahala, in real estate circles, is just as renowned as Palm Beach or Beverly Hills, she said.
"Kahala is a household word," Bruhl said. "Whenever you buy in Kahala, it's always a good investment, as long as you hold it long enough."
Two of Kawamoto's acquisitions from last year -- 4337 and 4398 Kahala -- are listed by Pat Choi of Choi International for $2.6 million and $2.9 million, respectively.
To Kawamoto's credit, most of the homes, including the ones listed by Choi, appear to be in good condition. Some appear to be occupied, with ongoing upkeep and maintenance....
The eccentric tycoon, now close to his mid-70s, is known for approaching property owners at random, usually when the homes are not listed.
Don Eovino of Eovino & Associates was surprised when Kawamoto walked in last year and offered cash at his open house for a former Hemmeter Estate at 4807 Kainapau Place.
Eovino had been expecting to tear down the existing estate and build a brand new one he would price around $20 million, unless someone wanted to buy it "as is" for $12.9 million.
"Kawamoto walked in at the last hour," said Eovino. "He had seen the property when the previous owner owned it and tried to buy it then, but it was tied up with title problems."
The two struck a deal, with no broker in between, and closed the sale in cash.
Kawamoto also bought the two adjacent lots for $6.2 million.
Since purchasing the properties, he's knocked down the former caretaker's quarters, but renovations still appear to be under way.
June 25, 2005
Kawamoto sells Kaka'ako property,
buys in Kahala
By Andrew Gomes, Honolulu Advertiser
Real-estate tycoon Gensiro Kawamoto has abandoned his long-stalled plan to develop a mid-priced residential tower in Kaka'ako, in favor of buying the Kahala estate created by flamboyant developer Chris Hemmeter.
The Japanese billionaire recently sold his 1.6-acre commercial property bordered by Queen, South and Keawe streets for $11.8 million to a company headed by the president of local convenience store chain ABC Stores.
Kawamoto used the proceeds to help pay $12.2 million for the nearly 1-acre estate. The four-bedroom and five-bathroom beachfront house with fountains, a pavilion and tennis court was one of the most opulent Hawai'i homes when Hemmeter built it in the late 1980s. He died in 2003.
It is not publicly known what either buyer plans to do with their newly acquired properties.
ABC chief executive Paul Kosasa declined to disclose why he bought the Kaka'ako property through SMK Inc. "It's really premature," he said.
Kawamoto could not be reached.
The transactions are the latest shuffling of real-estate assets in Hawai'i for the enigmatic Japanese investor, who three years ago began selling many of the roughly 160 O'ahu homes that he snapped up with "pocket change" in the late 1980s.
Kawamoto in early 2002 announced plans to sell all his Hawai'i homes to take advantage of undisclosed "tremendous investment opportunities" in the United States and Japan. Soon afterwards, he scaled down the sell-off plan, disposing of about 60 homes.
Over the last two years, Kawamoto has sold more homes, including about 20 since January, and used proceeds under tax-free exchange rules to buy several more homes, mostly in Kahala.
Property records show Kawamoto bought four Kahala homes this year for between $2 million and $3 million each. Between 2002 and 2004, he also bought Kahala homes for $1.7 million, $3.6 million and $8 million.
Kawamoto bought the Kaka'ako commercial property in 1989 for $14.8 million, and announced that he would "immediately" start working to develop a 250-unit apartment building on which he said he didn't expect a profit.
At the time, then-Mayor Frank Fasi, who was an outspoken critic of foreign investor impact on Hawai'i's real estate market, complained that he felt Kawamoto's Kaka'ako plan was nothing more than a publicity stunt.
Kawamoto never submitted development plans to the state agency governing development in Kaka'ako, though the market for residential condominiums crashed in the early 1990s.
Then when Kawamoto reappeared on the local real-estate scene in early 2002 as the condo market took off, he announced that he would revive plans for the 25-story residential building with units for rent or for sale to middle-income buyers.
In early 2003, he said he personally was working on an elegant "antique" design, and wanted to start work that year.
January 9, 2003
Real estate investor fires lawyer,
By Andrew Gomes, Honolulu Advertiser
Gensiro Kawamoto, the Hawai'i home-buying billionaire from Japan, yesterday announced he has fired his local attorney and property management firm, and will personally oversee the roughly 100 homes he still owns here.
The enigmatic real estate investor said in a letter faxed through an intermediary that he made the abrupt changes after seeing his Hawai'i rental properties last year for the first time in 10 years.
"I was shocked and upset to see the disastrous conditions of these rental houses," he wrote. "I will never allow these kinds of incidents to occur again."
Kawamoto did not elaborate on home conditions, though one person familiar with the properties said some are vacant and uninhabitable, while others have extensive damage and have been the subject of citations and complaints.
Carol Asai-Sato, Kawamoto's long-time Honolulu attorney, who selected property managers, was terminated Nov. 15, Kawamoto said.
Asai-Sato, an attorney with Alston Hunt Floyd & Ing, said Kawamoto's statements were "absolutely not true." She reserved more specific comment until after careful review of Kawamoto's statements. "We will definitely be making a response," she said.
Kawamoto did not identify the property management company he said he terminated in November, and he did not immediately respond to questions yesterday.
Waikiki-based Toyo Realty was recently retained to help Kawamoto manage 103 homes he still owns here. But Kawamoto added: "From now on, I will supervise everything myself again."
Kawamoto said he hopes to live in Hawai'i for at least six months out of the year, and indicated he plans to make more Island investments "which can be welcomed by the local people."
What those investments could be are hard to predict. Kawamoto has a reputation for being unconventional, and his business decisions have not always gone over well in communities.
The 70-year-old billionaire, who made his fortune in real estate in Japan, embarked on a plan to buy as many as 1,000 homes here almost 15 years ago following a trip during which he noticed many houses for sale and a shortage of rentals.
Bending to public criticism, Kawamoto in 1988 cut short his plan, but still spent at least $85 million in "pocket money" buying almost 200 Hawai'i properties, including the leasehold Kaiser estate for $42.5 million, which he later gave up to landowner Kamehameha Schools.
Kawamoto disposed of few Hawai'i properties until February 2002 when he listed for sale 61 of the homes, many at below-market prices.
The flood of perceived deals concentrated in neighborhoods such as Portlock and Kailua created a frenzy among real estate brokers and interested buyers, some of whom resorted to making offers on homes without so much as a peak inside — a tactic Kawamoto employed to acquire some of the properties. All but three of the 61 have sold.
At about the same time in California, where Kawamoto owned 670 houses, he initially gave 30-day lease termination notices to about 600 renters, creating an outcry and an agreement to extend the move-out deadline to 90 days.
And in Kahalu'u, Kawamoto's construction of a vacation home on a 130-acre property angered neighbors who on Christmas Eve 2001 found Kawamoto had blocked access to their carports, a dispute resolved when the city condemned an easement.
Kawamoto said in yesterday's statement that the incidents in California and Kahalu'u were "performed by playing with laws, in unreasonable and inhuman ways, using my name.
"... I have decided to select such people with gentle and warm hearts for my management company, lawyer and all other people concerned. My investments here will be pleasant and enjoyable ones."
September 27, 2003
Kawamoto suit moved from isles to California
Japanese billionaire Gensiro Kawamoto's federal lawsuit against property management firm CB Richard Ellis Inc. has been ordered to be moved to California from Honolulu.
Kawamoto sued CB Richard Ellis in May, alleging the firm mismanaged 642 rental units in California. Kawamoto previously settled a suit that accused him of keeping 149 Santa Rosa homes in disrepair.
CB Richard Ellis filed a motion to transfer the case, and U.S. District Judge Susan Oki Mollway granted the motion last week. The judge said moving the case would avoid substantial costs and inconveniences since most of the potential witnesses are in California.
< < < FLASHBACK < < <
December 12, 2000
Last piece of Kaiser estate sold for $5.1 million
By Russ Lynch, Honolulu Star-Bulletin
The guesthouse at the famous Kaiser estate in Portlock has been sold for $5.1 million, about $800,000 lower than the latest asking price but still one of the highest home prices on Oahu in recent years.
The buyer asked for anonymity but is a Nevada resident, said the sales agent, Christine O’Brien of Coldwell Banker Commercial Pacific Properties. The sale included the house at 505 Portlock Road and its 80,000 square feet of land.
The guesthouse was the last of three pieces to be sold since Japanese billionaire Gensiro Kawamoto turned it over to landowner Kamehameha Schools in 1994 in a protest against its attempt to charge him a lease rental of $1 million a year for the land.
After a sealed-bid auction in 1997 failed, the seven-acre property was split into three parts, which were offered for sale as fee simple.
The first parcel to sell, the four-story boathouse and dock, changed hands for $5 million later that year. The main house was sold in February this year for $9.6 million.
While the identity of the buyers has not been disclosed, real estate sources say the three pieces went to two buyers.
The latest sale brings the total since Kamehameha Schools put it on the market to $19.7 million. Kawamoto had paid about $42 million for the whole property in 1988.
The luxurious oceanfront estate was originally developed by industrialist Henry J. Kaiser, who created the nearby Hawaii Kai development. It was completed in 1959. Kaiser died there in 1967 and in 1971 it was sold to the wealthy Goldman Brothers ...
For more about Hawaii Kai development, GO TO > > > Paradise Paved
* * *
February 27, 2003
Owner Defends Lease Action, But Bends a Bit:
The Japanese Billionaire Calls Himself
the Victim of a Smear Campaign
SACRAMENTO - Responding with bitterness to the controversy surrounding his abrupt move to sell off rental homes in California, billionaire Gensiro Kawamoto called his accusers “publicity seekers” and portrayed himself as a responsible investor who had fallen victim to a smear campaign.
In a rambling 20-minute phone interview from his Ginza headquarters, the famously reclusive magnate said he was particularly irked by the stance of California officials, who have sided with the hundreds of families who are being forced from their rental homes.
“The strange thing is (my critics) are top-level officials. They should study their own law,” he fumed. “This isn’t Indonesia. I’m no yakuza. I’m a law-abiding person. If people don’t like the law, they should change it,” he said repeatedly, pointing out he was acting in accordance with California regulations, in particular a century-old law that allows a 30-day notification period before cancelling tenants’ month-to-month leases.
“It’s true I have a lot of money. I’m being tarred just because I’m a rich man,” he said, accusing his tenants of ingratitude.
“They ought to be thanking me,” he added, noting that his rents remained well below market rates during the 13 years he’s owned the houses.
In early February, Kawamoto sent lease termination notices to tenants of 420 houses in five subdivisions he owns in Citrus Heights, Antelope, Rocklin and Orangevale. He has said he plans to sell the houses locally, as well as houses he owns in Santa Rosa, as quickly as possible.
American politicians, including Gov. Gray Davis, have asked the Japanese government to intercede with Kawamoto. But a spokesman for the Foreign Ministry in Tokyo said that since no criminal violations were involved, the Japanese government had no official statement on the case, calling it “a private matter.”...
Kawamoto, president of Marugen Co., first registered on the national radar in 1987, when Japan’s inflated asset prices created dozens of land and stock billionaires. During the telephone interview, and in previous published interviews, Kawamoto bragged about how his shrewd deal making saved him from the fate of many other Japanese investors in U.S. real estate....
“Everyone else was buying hotels and golf courses. And everyone else failed,” he said in the phone interview. “No one else bought rental houses (like me).”
Kawamoto says he owns 800 properties in Hawaii (Oahu and Maui) and California, and 3,500 in Tokyo and the southern island of Kyushu, his birthplace. His property in Japan is commercial, not residential.
His signature properties are the red-and-green Marugen buildings in Tokyo, clustered in the city’s most popular nighttime playgrounds: Ginza, Japan’s Fifth Avenue; Akasaka, which is favored by politicians; the Roppongi nightclub area, and Shinjuku’s Kabuki-cho, a Times Square-like district know for its yakuza, or mobsters, as well as its massage parlors....
September 30, 2003
PBS to Buy Waikiki Site
By Tim Ruel, Honolulu Star-Bulletin
The Hawaii Public Television Foundation, operator of PBS Hawaii, plans to buy a vacant lot next door to Hard Rock Café in Waikiki for $2.5 million.
Hawaii Public Television is buying the property from the bankruptcy estate of imprisoned financier Sukamto Sia, according to a document filed this month in U.S. Bankruptcy Court.
PBS Hawaii, formerly a state agency that went private in July 2000, is currently located at the corner of University Avenue and Dole Street, across from the University of Hawaii-Manoa campus. PBS Hawaii has been leasing its 28,000-square-foot station from the state since PBS went private, and the lease is scheduled to run through the end of 2005.
It’s no secret that PBS Hawaii has been looking for a new home, though the purchase agreement raises questions about its financing plans, since the station has said it expects its operating budget will drop 7.6 percent to $4.9 million next year from $5.3 million last year.
PBS Hawaii recently laid off four people, reducing its staff to 28 employees from 32, part of cost-cutting. When the station was a state agency, it had as many as 75 employees, before state budget cuts.
The Waikiki site, known as the VFW Lot, is 28,761 square feet, and PBS Hawaii will pay about $85 a square foot, if the sales agreement goes through as planned. The land is located at 1812 Kalakaua Ave.
Mike McCartney, a former state senator who is president and chief operating officer of PBS Hawaii advised the station’s committee members yesterday. PBS Hawaii was expected to make a public announcement today.
Sia’s Hawaii Convention Center Partners acquired the VFW Lot in 1994. Sia, an Indonesian investor, also acquired and sold to the state the site that houses the nearly $350 million Hawaii Convention Center.
Sia, who once owned the now-defunct Bank of Honolulu, filed bankruptcy in Honolulu in 1998. At the time, Sia claimed he had nearly $300 million on debts, and assets of only $9 million. Sia later pleaded guilty to bankruptcy fraud and wire fraud in an agreement with federal prosecutors, and is serving a three-year prison sentence.
Japan-based Chuo Mitsui Trust & Banking Co., which holds the mortgage on the Waikiki property, has agreed to release the lot from the mortgage to allow the sale, and will receive the net sale proceeds, according to the filing in U.S. Bankruptcy Court.
Commercial real estate firm CB Richard Ellis is brokering the deal for a 4 percent fee, and its broker, Scott Gomes, will receive part of the fee. Gomes is a director of Waikiki Crossroads Development Inc., the general partner of Hawaii Convention Center Partners, the seller of the property.
Guido Giacometti, the court-appointed trustee overseeing Sia’s bankruptcy estate and president of Waikiki Crossroads, has found the broker fee fair and reasonable, according to the filing.
Giacometti has filed a motion seeking court approval of the sale to Hawaii Public Television. The sale does not include a nearby property owned by Hawaii Convention Center Partners.
Seeking money to pay Sia’s creditors, Giacometti has sold other Sia properties in recent years, including an undeveloped 1.6-acre parcel atop Maunalani Heights on Oahu, a Singapore apartment and Sia’s posh estate in Bel Air, Los Angeles, which fetched $4.6 million.
For more on Sia and Giacometti, GO TO > > > The Indonesian Connection; Confessions of a Whistleblower; Office of the United States Trustee vs. Harmon
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THE CONTINUING SAGA OF GENSIRO KAWAMOTO
By Ma, Lybia, Hawaii Business
The affordable-housing offerings of Japanese billionaire Gensiro Kawamoto are his way of making a contribution to the people of Hawaii, says his local spokesperson/attorney. But at least one construction industry observer says that the events surrounding Kawamoto's apparent generosity sound more like the plot of a bad soap opera. Kawamoto's ongoing personal battle with Honolulu Mayor Frank Fasi - a conflict that more than once has degenerated into childish name-calling - has been widely publicized. His recent withdrawal from a proposed affordable-housing subdivision in Kapolei is just the latest misadventure to land Kawamoto's name in the headlines.
Last January, Kawamoto suddenly pulled out of developing Kapolei Village Two, a 312-home affordable-housing subdivision, saying he had learned he would not be the one to hand out the keys to its first occupants. "He wants to be acknowledged as the developer who developed the project and took the (financial) loss. Otherwise, there would be no meaning to the project," his attorney, Carol Asai-Sato, told the local media. But Joe Conant, the state's Housing Finance and Development Corp. executive director, told the press that no one at HFDC had told Kawamoto he wouldn't get credit, and that Kawamoto could have handed out the keys if he so desired. With Kawamoto's withdrawal from the project, the HFDC selected Watt Hawaii Inc. - the developer of Kapolei's Village Three - as the new developer of Village Two.
The Japanese billionaire initially proposed building both villages, intending to price 80 percent of the 618 homes in the affordable-housing range. Kawamoto stood to lose $39.4 million in developing the project - a loss he said he was willing to incur to improve the negative image of Japanese investors in Hawaii. But Fasi charged that all Kawamoto did was further undermine that image. He called Kawamoto an "Ugly Japanese" - a reference to the "Ugly American" label pinned on Americans traveling abroad in the 1950s.
Fasi's remarks are not the first verbal assaults that Kawamoto has had to fend off. Ranked by The Japan Economic Journal as the sixth richest individual in Japan in 1987, Kawamoto went on his first Hawaii home-buying spree in the fall of that year, when he purchased more than 70 Oahu homes in four months. The Boston Globe later quoted the billionaire as saying the homes he bought in Hawaii were "lousy, candy houses." The remark riled local residents, who accused Japanese investors collectively of gobbling up available inventory, adding to the high cost of housing and causing property taxes to soar.
According to Locations Inc., Kawamoto has bought about 176 local homes and condominiums valued at approximately $85 million, including houses in Portlock, Hawaii Kai and Kailua, and 39 apartments in the Royal Capital Plaza. Some of his larger purchases and development plans - which may keep local contractors smiling if they all come to fruition - include:
* The $42.5-million purchase of Kaiser Estate in Portlock in the spring of 1988. Rumors circulated at the time that Kawamoto wanted to build a Japanese kiddie camp at the Hawaii Kai address, but Asai-Sato says she has no knowledge of such plans.
* The $14.8-million purchase, from the Harry and Jeanette Weinberg Foundation in September 1989, of 1.6 acres in Kakaako for rental housing - one portion of the approximately $500 million in rental units that Kawamoto intends to build over the next few years.
* The December 1989, $19-million purchase of 147.5 acres in Kihei, Maui. Kawamoto hopes to develop 1,050 homes there, of which 50.6 percent would be affordable housing. Kawamoto is currently proceeding with the necessary approvals, after successful negotiations with Maui Mayor Hannibal Tavares. Kawamoto's disdain for Fasi, whom the billionaire once described as "agitated like a maniac," apparently does not extend to Fasi's counterpart on Maui. In February, Kawamoto pronounced through his interpreter that Tavares "is an outstanding mayor who is genuinely interested in the construction of homes on Maui."
Carol Asai-Sato - The Hawaii-based attorney with Alston Hunt Floyd & Ing who was fired by Gensiro Kawamoto.
February 3, 1997
Asai-Sato gives Japanese scoop to American way of biz
By Kristine Uyeno, Pacific Business News
“No women applicants please.”
That statement stared back at Carol Y. Asai-Sato from a law firm employment notice on a Willamette University bulletin board.
More than 20 years ago, it was evident women were few and far between in the legal services industry....
Asato-Sato has proven gender is not a factor in success. Effective Feb. 1, she joins the law firm Alston Hunt Floyd & Ing as a partner. She said she decided to join the company because its client servicing philosophy matched hers: the client always comes first.
Asai-Sato is making this career move after spending about nine years with Rush Moore Craven Sutton Morry & Beh as of counsel and most recently, partner. She is the fourth attorney from the firm to join Alston Hunt Floyd & Ing in recent years. Alston Hunt Floyd & Ing has about 25 attorneys.
Asai-Sato represents mainly Japanese clients in business-related and real estate matters....
After facing many gender-related obstacles at Willamette, she graduated and returned to the Islands to work for Ashford & Wriston for four years. Later, she moved to Boston and worked for several years at Bank of New England doing commercial loan documents and negotiations....
In the early 1980s, she returned to Hawaii and served as senior counsel for Alexander & Baldwin Inc. before joining Rush Moore Craven Sutton Morry & Beh.
“Professionally, she’s excellent. I’ve got the utmost respect for her,” said Dale Nishikawa, president of the real estate company, Marcus & Associates Inc.
Nishikawa has recommended her to some of his clients and they have been satisfied with Asai-Sato’s services....
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MORE TO COME FROM ... THE CATBIRD SEAT
In the meantime, you can browse through the following as you’re having your breakfast birdseed and morning coffee...
BROKEN TRUST: THE BOOK
BUZZARDS OF PARADISE
CLAIMS BY HARMON
CONFESSIONS OF A WHISTLEBLOWER
DIRTY MONEY, DIRTY POLITICS & BISHOP ESTATE
THE HARMON ARBITRATION
THE INDONESIAN CONNECTION
NEW SONGS BY THE WHISTLER
THE NESTS OF CB RICHARD ELLIS
THE SILENCE OF THE WHISTLEBLOWERS
THE VULTURES IN MAUNAWILI VALLEY
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MORE OF THE CATBIRD’S FAVORITE LINKS
THE CATBIRD SEAT FORUM
THE CATBIRD SEAT
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Last update December 15, 2007, by The Catbird.