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The Honolulu Advertiser
Posted on: Thursday, October 2, 2003

Fong's Kahalu'u site attracts low bidders

By Andrew Gomes
Advertiser Staff Writer

FONG
O'ahu visitor attraction Senator Fong's Plantation & Gardens sold for pennies on the dollar at a foreclosure auction yesterday to a speculative land investor and a neighbor who farms taro leaf.

The two buyers bid on separate parcels of the 720-acre nature park and preserve owned by former U.S. Sen. Hiram Fong Sr., and said they don't plan to continue tours at the Kahalu'u property.

But the bids are subject to a court confirmation hearing to be scheduled in the next several weeks, at which time higher offers could be made by others interested in acquiring the Windward attraction.

The botanical park will continue operating until a sale is confirmed and closes, which could take a few months.

Still, yesterday's auction on the veranda of the Circuit Court building in Honolulu had the feeling of a sad ending for an attraction that welcomes more than 100,000 visitors a year but contributed to the financial demise of Fong, who turned 97 yesterday.

"It is a shame that it had to come to this," said Allen Wong, the taro leaf farmer who made a high bid of $70,000 for 212 acres of leasehold property with buildings assessed for tax purposes at $606,300.

Jere Henderson, a land investor with property on the Big Island and the Mainland, also said he didn't feel good about Fong's predicament. Henderson made the high bid of $35,000 for Fong's half interest in 508 acres of fee-simple conservation land with a total assessed value of $601,100.

The two winning bids equated to roughly 11 cents on the dollar for the assets of Fong's Plantation based on assessed value, which may not reflect market value of the property.

Bank of Hawaii, which initiated the foreclosure a year ago after Fong and his attraction park company defaulted on a $698,867 loan balance, did not bid. The bank declined to say if it intends to bid at the confirmation hearing.

Henderson said he bid on the conservation land with the idea that a preservation group like the Nature Conservancy might pay more for it later.

Wong said he and his 92-year-old father, Leonard, bid for the leasehold property with the intention to farm it, perhaps growing papaya, and to rent out three homes and a pavilion included on the parcel primarily used for Fong's Plantation tours.

"It's an investment," said Allen Wong, who rents out about 70 homes and operates a farm on 50 acres below Fong's Plantation. "The price was right."

Hiram Fong Jr., the former senator's son, has disputed that the homes on the leasehold land are part of the plantation property, but foreclosure commissioner Clyde Umebayashi said the homes are included.

Fong and his wife, Ellyn, borrowed $1 million from Bank of Hawaii in 1987 to develop the botanical garden, which offers tram tours through five valleys and functions as a bird sanctuary.

Other members of the Fong family own the half interest in the conservation land not sold at auction yesterday.

The former senator filed for bankruptcy protection in March, and resigned from Finance Factors Ltd., a local financial institution he helped establish.

Fong also is embroiled in a dispute over control of Market City Shopping Center and other real estate holdings managed by another son, Marvin.

Fong served in the territorial Legislature for 14 years and in 1959 he was the first Asian American elected to the U.S. Senate. He retired in 1977.

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