Billionaire envisions low-rent Kahala homes
|Video: Kawamoto dreams of renting Kahala homes to low-income Native Hawaiians|
|Do you agree with Gensiro Kawamoto's plan for low-income rentals for Native Hawaiians on Kahala Avenue? Join our discussion.|
By Andrew Gomes
Advertiser Staff Writer
By Andrew Gomes
Kahala Avenue has long been the exclusive domain of wealthy mansion builders and land speculators, but one of the area's newer residents has a vision to open the ritzy neighborhood to regular folk.
Gensiro Kawamoto, the Japanese billionaire who in recent years has become the largest property owner on O'ahu's priciest avenue of residential real estate, said he wants to turn most of his 18 homes there into public museums and cheap rental housing.
In Kawamoto's vision, a mix of big modern mansions and smaller old homes on 10 adjacent properties would be rented to Native Hawaiians for as little as $100 to $200 a month.
Another five homes would become public museums displaying the billionaire's collection of Western, Oriental and Japanese art.
Some local residents aware of Kawamoto's recent home-buying spree have been wondering what the enigmatic real estate investor planned to do with his growing collection of vacant Kahala homes.
In an interview yesterday with The Advertiser, Kawamoto described an idea he said came to him about a year ago after feeling the neighborhood had no sense of community.
"I have a lot of properties on that street, but I don't feel that street is that enjoyable," he said through an interpreter.
Kawamoto, now in his 70s, added that he isn't aware of any Native Hawaiians living on Kahala Avenue. "This town has become a luxurious place for the special people," he said in a written statement. "I believe that Kahala should be a place for the Native Hawaiian people ... I want them to have barbecue parties on weekends by the beach with all their friends."
Some may view Kawamoto's plan as a genuine attempt to give back to Hawai'i residents, or a tycoon's eccentric idea. But the billionaire said he is sincere.
"If I wanted to rent to ordinary people, I could do it right away," he said. "It's not interesting if I rent it out to rich people. I think what I'm doing is right."
Kawamoto sees his idea as a way to fulfill his long-expressed desire to provide affordable housing in Hawai'i and give him a more favorable legacy than the one he's developed since he bought roughly 160 O'ahu homes with "pocket change" in the late 1980s. But the plan may face serious challenges.
Cynthia Thomas, an attorney and project manager for the Legal Aid Society of Hawai'i's fair housing enforcement program, said requiring that renters be Native Hawaiian would almost certainly violate federal and state housing discrimination laws.
"It's a great intent, but he might be hung up on the law," she said. "It would be similar to a white owner only wanting to rent to whites."
Creating museums and cheap rental housing on Kahala Avenue also could run into opposition from one of the island's most exclusive communities of wealthy and powerful homeowners.
Kawamoto said he expects objections from neighbors concerned about museums and cheap rentals degrading their property values, but he said they can move if they are unhappy. "They are rich people," he said. "They could go anywhere."
The real estate investor noted that part of his plan would involve renters maintaining their property as they see fit.
Previously, Kawamoto investments have stirred controversy in other O'ahu neighborhoods after he bought up homes mostly in East and Windward O'ahu in the late 1980s.
Kawamoto rented his property often for well below market value, but did little to maintain or improve the homes. In some cases, neighbors complained that homes in disrepair hurt their property values.
Kawamoto claimed that property managers didn't inform him of the conditions of his property. Property managers claimed Kawamoto was well informed and refused to authorize repairs.
In 2002, Kawamoto announced he would sell all his roughly 160 O'ahu homes, creating public concern over loss of so many rentals. Kawamoto sold 60 homes quickly, and gradually sold most of the rest, after making repairs or renovations to some.
USING 'POCKET MONEY'
Kawamoto started buying Kahala Avenue property in 2002, and resides part time in the former Hemmeter estate
According to records, Kawamoto has spent about $103 million on 18 Kahala Avenue properties through March.
Kawamoto said he has his eye on three more that he'd like to buy, and could buy up to 25 with a budget of $200 million in "pocket money."
"My focus in Hawai'i is not about making money," he said in a statement. "My real business is in Tokyo. Hawai'i is a place for me to release my creativity."
However, previous attempts by Kawamoto to develop low-income or middle-class affordable housing in Hawai'i have not been realized.
Kawamoto floated prior plans to build affordable housing, including one on Maui with 531 units, a Kaka'ako high-rise with 230 units, and another O'ahu project with 50 homes. But he blamed government requirements for derailing those plans.
Now the real estate investor said his latest affordable housing plan will focus on Kahala Avenue. "It'll change the community," he said.
Reach Andrew Gomes at firstname.lastname@example.org.