Billionaire fixing ruthless image

By Andrew Gomes
Advertiser Staff Writer

Gensiro Kawamoto says he is working to improve the condition of his rental houses on O'ahu. Richard Ambo • The Honolulu Advertiser

But Kawamoto is finding the business of managing his image tricky, and he can still leave contradictory impressions.

He has dumped the limousine and now takes taxis around town, but he still likes to talk about his money, like the story he tells casually of surprising a teller at a Waikiki bank branch yesterday when he asked to make a $48 million wire transfer.

Kawamoto, a 70-year-old real-estate tycoon, said he has been spending about 10 days a month in the state since November, working to upgrade 103 neglected rental homes on O'ahu and repair his own damaged image.

Kawamoto, who rarely speaks directly to reporters, said through a translator in a two-hour interview at The Advertiser yesterday that the intent behind his previous business dealings here has been misunderstood.

Apologizing for not wearing a business suit, but dapperly dressed in a beige blazer and black shirt, Kawamoto spoke repeatedly of his portrayal in the media as a ruthless investor who bought houses only so he could make more money.

That was not the case at all, he insists, and he is intent on changing the prevailing view of him.

In addition to fixing his rental homes, Kawamoto has been casually looking for additional investments in Hawai'i if the right property can be found, though he stressed that he is not on another real-estate buying mission. He said he doesn't particularly care if his investments make money and now invests in projects only if they are interesting.

"It is like a game," he said.

Kawamoto said the $48 million deposit he made with City Bank could be used to finance a roughly 20-story residential tower in Kaka'ako with 230 large one-bedroom units either for sale or rent to a middle-income target market. He said he is working on an elegant "antique" design himself and would like to start work this year on the property he owns, which is bordered by Queen, South and Keawe streets.

But he also said he suggested that City Bank use his $48-million deposit to offer its customers 4,800 low-interest loans of $10,000 each.

Other projects that could conceivably follow the Kaka'ako residential tower would be a long-planned, roughly 800-home subdivision in Kihei, Maui, and construction of a vacation home in Kahalu'u on O'ahu.

Kawamoto's rental homes are concentrated in Hawai'i Kai and Windward O'ahu neighborhoods. He said he has cleaned up the exterior of many homes, about 30 of which are vacant, and will focus on interior renovations with the expectation of finishing the work by spring.

Susie Macke, a vice president and property manager with Toyo Sales & Management Inc., said Kawamoto typically spends his time in Hawai'i visiting his rental properties to assess repair and renovation work.

Yumi Domingo, Toyo principal broker and executive vice president, said Kawamoto is going to great lengths to improve his assets. In one case where a tree had to be removed from a yard, Kawamoto had it dug up and transferred to another property instead of cutting it down, she said.

Kawamoto said this is the kind of caring person he wants to be known as, not someone who bought homes here in the late 1980s "like you buy candy."

People tell stories about Kawamoto riding around in a stretch limousine and deciding to buy homes without ever setting foot inside.

He said yesterday that he looked at more than 600 homes over three months to find the roughly 160 he bought — every one of which he carefully examined from the inside.

Kawamoto also said he ditched the limo to tone down his image, and today commutes via taxi.

"That's how much I was caring about the image," he said through his translator.

In addition to being decried as a slumlord, Kawamoto has been described as one of the main catalysts behind the Hawai'i real estate bubble in the late 1980s, which saw prices for practically anything with four walls skyrocket beyond reason. Kawamoto was described as using "pocket change" to buy dozens of houses at a time at highly inflated prices.

Yesterday, Kawamoto said he thought he was helping sellers out of financial trouble because people who sell their homes in Japan are usually in dire need of money.

At the time, he said he was advised by local attorneys to "keep a blank face" and not talk to the media because his words would be rearranged.

Kawamoto repeated allegations that his longtime local adviser, attorney Carol Asai-Sato of Alston Hunt Floyd & Ing, kept him in the dark about the failing condition of his Hawai'i rentals, which he said he saw in September 2001 for the first time in 10 years.

Asai-Sato has said her firm provided Kawamoto "careful, considered counsel" and that services were provided with his knowledge and at his direction.

Kawamoto said he was not fully advised of all situations and that many of his directions were misinterpreted. For instance, in California, where Kawamoto angered tenants of 670 homes he owns after they were given 30 days to move out, the billionaire said it was his attorney's decision to set move-out dates and sell all the homes at one time.

Since then, he said he gave some tenants six-month to one-year leases. All but five of the 670 homes are in escrow.

One particular move that angered local residents occurred in Kahalu'u, where neighbors to Kawamoto's 130-acre property were blocked from using their driveways on Christmas Eve.

Kawamoto said he always thought the neighbors had agreed to a friendly resolution and that he still doesn't know how the situation was resolved. (The city condemned access to the property and built a new driveway for the neighbors at taxpayer expense.)

Kawamoto said he was also surprised in late 2001 after seeing the condition of his Hawai'i rental homes, a shock he said led him to decide to sell all 162 homes before reconsidering and selling only 59.