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The Honolulu Advertiser

Posted on: Sunday, August 22, 2004

Absentee owner's houses in disrepair

By Andrew Gomes
Advertiser Staff Writer

Almost two years after Japanese billionaire Gensiro Kawamoto pledged to repair his vacant run-down rental homes on O'ahu, the enigmatic real estate investor appears to have made little improvement to some of the worst of his 100 homes on the island.

Gensiro Kawamoto
The dapper 72-year-old tycoon, who snapped up nearly 200 homes and other property in Hawai'i during the late '80s, has fascinated and infuriated many with the way he has neglected his investments.

After a visit in November 2001 — the first time he had seen his Hawai'i homes in 10 years, he said — Kawamoto professed shock that many of the homes were in failing condition and upsetting neighbors.

Kawamoto blamed his local attorney and property-management firm for keeping him in the dark, though they disputed his claim. Some former property managers said Kawamoto was advised of maintenance problems but let them fester.

Initially, Kawamoto planned to get rid of all the homes, but cut back that plan after selling about 60. In January 2003, he pledged to repair or renovate remaining unkempt houses.

This is what the Hawai'i Kai property at 349 Kaumakani St. looked like last week. According to a neighbor, contractors began renovations and repairs last year but the work stopped abruptly.

Rebecca Breyer • The Honolulu Advertiser

"I will never allow these kinds of incidents to occur again," he said in a statement at the time. "My investments here will be pleasant and enjoyable ones."

Since that time, Kawamoto has spent $14 million buying four more O'ahu homes, but eyesores remain, revealing little evidence that he followed through on upgrading 30 vacant houses he previously anticipated renovating by March 2003.

Earlier this month, complaints by neighbors of vacant Kaka'ako commercial buildings owned by Kawamoto led police to uncover vagrants living in the fenced-off complex with a hoard of suspected stolen property.

Kawamoto, who had planned to develop an affordable high-rise on the site, made a trip here to assist police in removing trespassers. Authorities asked Kawamoto to better secure the buildings.

Neighbors of Kawamoto's residential properties, which are largely concentrated in Hawai'i Kai and a Kaka'ako high-rise condo, also continue to have concerns about the condition of his homes, saying some hurt property values.

In Hawai'i Kai, where Kawamoto owns about 70 homes, most of his properties blend with the general character of the neighborhoods. But not the house at 349 Kaumakani St.

The vacant single-story home stands out with broken mirrored closet doors, carpeting and pieces of rotted wood piled in the front yard near a rusted-out mailbox. The yard also has accumulated four car batteries, a pallet and other junk.

One neighbor, who asked that his name not be used for fear of angering the real estate titan, said contractors last year began renovation and repair work, but abruptly stopped.

The few improvements made to Kawamoto's homes since his last public promise to take better care of them were "primarily cosmetic," Larry Sakagawa, who lives near a Kawamoto home in Hawai'i Kai, said in an e-mail.

Japanese billionaire Gensiro Kawamoto purchased this gated Kahala property last year for $8 million. He owns about 100 O'ahu homes but appears to have made few repairs to some of his run-down houses.

Rebecca Breyer • The Honolulu Advertiser

"The initial landscape cleaning was a chop-down and mow-down, but the frequency is far from regular.

"One of the homes appeared to have been painted, but upon closer inspection, only the garage and the front portion facing the street was painted."

Kawamoto did not respond to written questions submitted on Aug. 10 through his local property management firm, Kosei Realty.

Yumi Domingo, who established Kosei earlier this year, said Kawamoto has made repairs to some of his homes as tenants moved out, but she said she was not at liberty to elaborate on the status of his property.

According to city building permit records, there have been few significant repairs to Kawamoto homes in recent years.

In 2002, a new garage roof was added to a Portlock house for an estimated $8,000. An estimated $300 was spent on a retaining wall at another Hawai'i Kai home. A Kailua property underwent work estimated at $27,000 to replace fixtures and repair walls, framing and termite damage.

Since then, the only building permit on record for a Kawamoto home was to demolish a vacant Kailua house that was destroyed by fire late last year. Property records show that Kawamoto sold the property last month for $396,000 — nearly double the $200,000 he paid in 1988.

Kawamoto has done a little buying and selling of Hawai'i homes since his mass selloff two years ago, but generally he is riding the run-up in real estate values by holding his investments.

In June, Kawamoto sold a Hawai'i Kai house for $530,000, more than double the $258,000 he paid, and sold a nearby home days later for $465,000, compared with $225,000 he paid.

Kawamoto's recent purchases include an $8 million oceanfront mansion on Kahala Avenue that he bought last year, and a nearby 75-year-old house he bought last month for $1.7 million.

In late 2002, he also bought a $3.6 million house in Kahala and a $550,000 home in Portlock.

Meanwhile, other Portlock homes owned by Kawamoto have dead coconut trees, broken window and door screens, bad paint and phone books baking in driveways.

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