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The Honolulu Advertiser
Posted on: Wednesday, December 11, 2002

Kahana Gateway changing hands

By Andrew Gomes
Advertiser Staff Writer

A California real estate investment firm is buying the West Maui retail and office complex Kahana Gateway from its developer, a partnership between the late founder of Foodland Super Market Ltd. and McDonald's Corp.

Triple Net Properties LLC, a nearly 5-year-old company based in Santa Ana, Calif., is making its second investment in Hawai'i with the estimated $17 million purchase from MHDC Partners.

The deal is expected to close tomorrow, according to letters received by center tenants from MHDC, which also manages the center.

A MHDC spokeswoman yesterday was unable to confirm the sale. Triple Net chief executive Tony Thompson was out of the office and unavailable.

A spokesman for the trust of Foodland founder Maurice Sullivan was also unavailable, as was an agent with CB Richard Ellis Hawaii Inc., which is brokering the sale and will assume management of the center for the new owner.

MHDC built the three-story office building in 1989 and most of the 60,000-square-foot retail center in 1990, according to property records. Both are located at Honoapi'ilani Highway and Ho'ohui Road at the entrance to Kahana between Ka'anapali and Kapalua.

Tenants include Roy's Kahana Bar & Grill, Roy's Nicolina Restaurant, McDonald's, resort retailers and several real estate-related businesses.

CB Richard Ellis had listed the center, which is about 90 percent occupied, for $21 million. Its appraised value for tax-assessment purposes is $12.5 million.

Triple Net was founded in April 1998 and is invested in more than 50 properties in the Western United States bought alone or with partners for $561 million. The firm invested in Crossroads Center on the Big Island in 1999 before selling 13 months later. Triple Net has maintained other investments since making them more than four years ago.

Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.