Posted on: Friday, March 5, 2004

No concrete, no home sales

By Andrew Gomes
Advertiser Staff Writer

One of the state's largest home builders has stopped selling new homes because of the concrete strike, canceling two sales events scheduled this weekend and next.

The decision by Gentry Homes is the first postponement of new-home sales among the state's major developers, but others say they soon could be forced to make similar moves if the 29-day strike drags on.

Until now, the strike by workers at O'ahu's two main concrete companies — Ameron Hawaii and Hawaiian Cement — has delayed construction and delivery of purchased homes.

Now, the strike's ripple effect is spoiling real estate sales, and it is expected to compound price pressures in the home resale market where demand is pinching supply.

Gentry was expecting to offer 11 homes at its Las Brisas project in 'Ewa Beach tomorrow, followed by another 10 to 12 homes at its Prescott project nearby on March 13.

"We don't like to sell something that we can't start," said Rick Hobson, sales and marketing vice president for Gentry. "We like to give (buyers a completion date), and we can't give them a date until we start."

Hobson said that sales planned later this month for a third Ewa By Gentry project, about dozen or so homes in the Hu'elani neighborhood, also could be delayed if the 29-day-old strike rolls on.

Ameron Hawaii and Teamsters negotiators met yesterday to consider a proposal from federal mediator Ken Kawamoto to bring an end to the strike that has idled hundreds of construction workers and halted dozens of projects.

Talks broke off at 7:30 p.m. Ameron Vice President George West said Kawamoto was trying to schedule more talks for next week. "I would say the meetings are effective," West said. "We're considering the suggestions."

But Teamsters President Mel Kahele called the meeting "a waste of our time," saying the company is not budging from its position.

The state's biggest home builder, Castle & Cooke Hawai'i, estimates that it may have to halt sales if the strike continues for another

30 days, according to Bruce Barrett, company sales and marketing vice president.

Barrett said Castle & Cooke will go ahead with planned sales later this month of 30 to 45 homes.

Schuler Homes figures it may also have to cancel sales if the strike lasts another month. Its next scheduled sales release is for about 16 homes at two projects in April.

Haseko Homes, developer of Ocean Pointe in 'Ewa Beach, has been releasing about 30 homes a month for sale, and figures it can continue to do so only for another month or two under the strike.

Haseko's last release of 28 homes for registered buyers was made on Tuesday. "It hasn't hurt us yet, but at some point it has to," said Richard Dunn, executive vice president of Haseko Realty.

As the strike drags on, more prospective new-home buyers are expected to turn to a strained resale market, putting added pressure on prices.

At the end of February there were 829 previously owned single-family homes and 1,187 condos for sale, the lowest numbers ever recorded according to the Honolulu Board of Realtors, which has tracked inventory since 1986. The median price for a single-family home in the resale market was a record $410,000 last month.

"It's going to be tough for a lot of people," said Sandy Kurosaki, an agent with Coldwell Banker Pacific Properties in Kailua. "The concrete strike will start driving prices up."

Developers including Schuler, Gentry and Castle & Cooke generally try to limit the span between selling and delivering a new home to about six months. So they want to refrain from making new sales if they can't meet their timetable.

Stanford Carr Development, which has a massive home project in Hawai'i Kai, is developing homes with a longer lead time — about a year between selling and delivering a home.

Patrick O'Neill, vice president of sales and marketing for Stanford Carr Development, said the company has about 200 sales for homes with delivery dates delayed by the concrete strike. Reservations for another 112 units have been taken and should result in sales without a problem because concrete construction isn't scheduled for a while.

Depending on how long the strike lasts, brokers said problems for home buyers will only get worse. Some buyers need to move into their new home by a certain date because they sold their current residence to someone else.

Advertiser staff writer Peter Boylan contributed to this report. Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.