PacificBusinessNews-article

November 9, 2013

Kaneohe Ranch selling Hawaii real estate, Kailua town for $262M

By Duane Shimogawa

Kaneohe Ranch is selling its Hawaii commercial real estate portfolio, which includes much of Kailua town in Windward Oahu, to a public company for $262 million in a deal expected to close by the end of the year, according to a petition filed by a beneficiary seeking to postpone a vote on the sale scheduled for next week.
A source has confirmed to Pacific Business News that Alexander & Baldwin Inc. is the buyer.
The Honolulu Star-Advertiser reports, however, that the public company was not identified in the petition filed by Jeremy C. Baldwin in 1st Circuit Court on Friday.
Baldwin said in the petition that a notice from Bank of Hawaii, which is a trustee for the trusts that hold the Hawaii assets, received on Thursday required a response with "yes" or "no" vote on the sale by Monday, the newspaper reported.
Mitch D'Olier, president and CEO of Kaneohe Ranch, declined to comment on the report in an email Saturday morning.
D'Olier told PBN in July that Kaneohe Ranch and the Harold K.L. Castle Foundation expected to make a decision on the sale of the ranch assets by last month.
Chris Benjamin, president and Chief Operating Officer of Honolulu-based A&B (NYSE: ALEX) previously told PBN that A&B was interested in acquiring Kaneohe Ranch properties. Benjamin did not immediately respond to an email seeking comment Saturday morning.
Kaneohe Ranch said in May that the rising land values in Hawaii prompted the Harold K.L. Castle family to put its commercial real estate holdings, which include retail and lease fee land interests in Kailua town, Kaneohe and Kaimuki, and nine properties on the Mainland. The Mainland property is reportedly not included in the pending sale.
Local real estate experts had estimated the sale of the entire portfolio could have topped $1 billion, eclipsing the $300 million Oracle Corp. CEO Larry Ellison paid last year to acquire the island of Lanai from Castle & Cooke CEO David Murdock.
A&B recently closed on the purchase of another Hawaii real estate portfolio, the residential properties on Oahu and Maui owned by Japanese billionaire Genshiro Kawamoto, for $98 million. A&B is in the process of fixing up the former Kawamoto homes in Honolulu's Kahala neighborhood and offering them for sale.