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HomeMy WebLinkAboutCOM 0724.000 1998-2000 J„1 hq~ Virginia Goldstein Stephen K. Yamashiro ~~d Dbecm. Mayor ':G,~~: • Russell Kokubun ~ i - Deputy Director V+i S'.. il._ _ ~~)p•e~ •~i,J, .oo r~~,~~~~ ~a r~~ ~ ~3 C~nixllt~r ~~tftrttit PLANNING DEPARTMENT 25 Aupuni Street, Room 109 • Hilo, Hawaii 96720-42 March 24, 2000 (808) 961-8288 • Fax (809) 961-8742 Mr. Gregg Kashiwa GAMREX, Inc. 1188 Bishop Street, Suite 903 Honolulu, HI 96813 Dear Mr. Kashiwa: Change of Zone Ordinance No. 84 23, as amended by Ordinance Nos. 84 42, 88 4, 90 62, 91 96, 93 26, 94 34, 97 99 (REZ 470) LUC Docket No. A83-549 (LUC 534) Applicant: GAMREX, Inc. Subject: Annual Report TMK• 7-6-21:4.9-13.15-17 This is to acknowledge receipt of three copies of your annual report dated February 25, 2000. We note that the submission of an annual report is not required under Ordinance No. 97 99, but required under Condition No. 3 of the above-referenced LUC Docket. We appreciate the opportunity to provide comments on the on-going project. We have reviewed the annual report, and have no comments or objections at this time. Copies of your report will be forwarded to the State Land Use Commission, Planning Commission and County Council for their information. Should you have any questions, please call Phyllis Fujimoto or Susan Gagorik of this office at 961-8288. Sincerely, t r' ~i ,~-G~ SV.t.~ VIRGINIA STEIN Planning Direct PF:pak p:\wpwin60\phyllisV.GamrexREZ470. doc Comm. No. ' Fite No.~y Ret'. 1'0: xef, Dew MAR 2 9 ~nnn _ Mr. Gregg Kashiwa GAMREX, Inc. Page 2 March 24, 2000 c: ~Iawaii County Council Planning Commission West Hawaii Office State Land Use Commission (LUC Docket No. A83-549) '00 ~1HR 1 A(R 11 'i9 X00 17AR 1 AfR 11 COUNTY OF HAWAII COUNTY OF HAWAII PLANNING DEPT. PLANNING GEPT. KONA OFFICE KONd OFFICE ANNUAL PROGRESS REPORT GAMREX, INC. KUNA VISTAS SUBDIVISION Holualoa, North Kona, Hawaii February 25,2000 PREPARED FOR: Gamrex, Inc. 1188 Bishop Street Suite 903 Honolulu, Hawaii 968li Phone: (808)531-6861 PREPARED BY: Gregg Kashiwa Project Planners Hawaii 5375 Kalanianaole Highway Honolulu, Hawaii 96813 Phone: (808)329-9724 FAX: (808) 326-2789 DATED: February 25, 2000 RE: Land Use Commission Docket No. A83-549 State of Hawaii Change of Zone Ordinance No. 84-23 (REZ 470), as amended TAX MAP KEYS: 7-6-21:4, 9-13, 15-17 Third Division INTRODUCTION This annual report, as in past submissions, will be presented in the four main conditions of approval which are inter-related and dictate the critical path of development through the RS 15 and RM 5 zoned areas. They will be presented in the following order: 1. The RS 15 zoned area (single-family residential) 2. The Drainage system (flood control) 3. The Affordable Housing Agreement 4. The RM 5 zoned area (multi-family residential) Garmex, Inc. continues to actively market Unit 1 of the Kona Vistas subdivision. The site sales office is open seven days a week between the hours of 10:00 c1. M. and 5:00 P. M. This effort is supported by active advertising in the West Hawaii Today as well as membership ir. the Hawaii Island Board of Realtors and its Multiple Listing Service. Kona Vistas also has a web site and an a-mail address. Marketing et1'orts have been continuously exercised since March of 1993 when marketing commenced. Real estate market conditions improved during 1999. At the end of 1998, Gamrex reported it had sixty-two (62) lots remaining unsold. There are 110 lots in Unit 1 of Kona Vistas subdivision. This unsold inventory represented 56.4% of the first increment. At that time, there was no immediate need for additional inventory. At the close of 1998, there appeared to be at least three (3) years of unsold inventory based on past annual sales records. Sales during the preceding five years had been slow. Both house package and vacant lot sales were offered at Kona Vistas. In 1999, market activity has increased significantly. The West Hawaii real estate market has shown signs of sustained growth over the closing months in 1999. During 1999 most of the sales at Kona Vistas were vacant lots. Only one house package was built. Market trends in the last quarter of 1999 showed an increasing demand for new homes within the Kona Vistas market area. House package sales will be discussed in greater detail in the RS 15 portion of this report. Gamrex, Inc. has maintained its presence and support of the Kona Vistas project throughout 1999. During the year, it has seen a reduction in inventory, continued planning for the remainder of Unit 1 within the RS 15 zoned area and for the first time, reason to believe that market conditions are improving. MLS sales data support this quiet optimism. West Hawaii has slumbered for over eight years, and economic realities of a Annual Progress Repurt Page Two slow market have taken a toll on those developers unable to hold onto their properties. Many of these properties have been auctioned off or disposed of at reduced prices. Restructuring of the Kona market has run its course. Most of the distress sales have been made and the restructured Kona market is presently moving forward again. Gamrex continues to maintain fuli control of Kona Vistas. Its Kona staff and Honolulu management remain dedicated to creation of a quality development. It has started on the first leg to profitability for the subdivision and development. THE RS 15 ZONED AREA Increment 1 of the RS 15 zoned area was completed in 1992. At the close of 1999, 41 lots in Increment 1 remained unsold. Most sales in 1999 were vacant lot sales. Gamrex built and sold only one house package in 1999. There now are strong indications that the market for aew homes is much stronger after an eight year hiatus. Seeing this need, Gamrex, in the third quarter of 1999, began a new house package program. Six new house models were designed and lots were reserved for their construction. Twelve lots were selected fvr this effort and graded. Homes were started on them as site work was completed. They were not pre-sold. None of these homes were completed in 1999. To date (January 1, 2000 ro February 25, 2000), one of these homes was completed and c]osed escrow. There are three other house packages in escrow, awaiting completion. The results of Gamrex's home building effort will be detailed in next year's annual progress report. Many of the buyers of vacant lots have started construction on their homes and there is a great arnount of construction activity on going within Unit 1 at Kona Vistas. There are currently approximately twenty (20) homes in various stages of completion, with several more awaiting building permits. Unit 1 at Kona Vistas is fast approaching the point where there will be more homes than vacant lots. This will mark the point where the subdivision becomes a true community. This construction activity is both exciting and encouraging. The community association of home owners actively enjoys the use of the recreation center whi:,h is maintained at Gamrex's expense. This practice is expected to continue through 2002 or until 75% of all the lots in the subdivision are sold. P.egular meetings of the association are held with pot-luck dinners that follow. An active neighborhood watch program is operational. The association members}~ip is active and involved in the daily problems that arise. Unit 2 of the RS 15 zoned area has not been built. There will be an estimated 100 additional lots in Unit 2. Plans for the roadways and infrastructure are in for review by the Annual Progress Report Page Three utility companies. Upon approval, the plans will be submitted to tl~e County of Hawaii for its review. The process is ongoing. It is not known how long this process will take. The County of Hawaii is anxious for the Lako Street extension to be constn~cted within Unit 2 which will link the tolani subdivision located mauka of Kona Vistas to Kuakini Hi~~hway. Gamrex is fully aware of this and is working diligently to get all plans approved. Gamrex is moving forv<ard with the RS 15 development schedule as fast as the market will support its completion. Continued market expansion will expedite that schedule. 2000 will be an important year for Kona Vistas and West Hawaii. Should the general real estate market maintain its present momentum, all projects in Kona will move towards fulfillment of their zoning conditions. Without this, no justification for further infrastructural improvements are warranted. For the first time in over eight years, market conditions show signs of sustained improvement. Gamrex is prepared to move forward with this market. Its commitment to a quality subdivision I~as never wavered, and it continues to add valuable housing opportunities to North Kona housing stock. THE DRAINAGE SYSTEM Holualoa and Horse-Shoe Bc:nd Streams As reported in the 1998 annual report, Gamrex has held up further approvals of the flood control system. A Special Management Area Use Permit is required for the portions of the system located makai of Kuakini Highway. The down-stream portion of the channels must be connected to existing improvements within the Kuakini Makai subdivision. A portion of channel that connects to the existing culvert under Kupuna Street must be constructed over an existing lot in Kalani Makai. The channel must then be connected to the culvert which leads under Kupuna Street. The combined confluence of both the Holualoa and Horse-Shoe Bend streams will flow through these channels and into the existing channels bordering the Kalani Makai subdivision. These elements, the existing channel, the bridge and culvert and all the roadways within Kalani Makai subdivision were never dedicated to the County of Hawaii. While it was a requirement of final subdivision approval, these elements remain under private ownership. The present owner(s) of the channel, roadways and bridge/culvert oppose connection of the improvements to or through their property. Gamrex has been awaiting the settlement of ownership between the County and the owners thereof. No significant progress has been made in 1999 on the purchase or Annual Progress Report Page Four condemnation of the required improvements. Once this matter has been settled, Gamrex can proceed forward with the SMA Use Permit and the remaining governmental approvals required for the flood control project. No progress has been made on the drainage system approvals since the last annual progress report. Approval(s) and construction of the drainage system have great impact on the affordable housing agreement and all development within the RM 5 zoned area. THE AFFORDABLE HOUSING AGREEMEN'T' Gamrex received an two year extension on its affordable hcusing agreement from the County of Hawaii in 1998. Its current agreement expires on December 31, 2000. A condition of the agreement requires the flood control improvements to be completed prior to dedication of the 12 acre affordable housing parcel to the County. As mentioned earlier, herein, Gamrex awaits the County to gain control of the down stream improvements prior to moving forward with the approvals. Based on this, the affordable housing parcel is also held up until resolution of the problem is reached. It is likely that the County will have to condemn the improvements required. Private ownership of the roadways has caused residents in the subdivision hardships, and it is in the best interests of everyone, that the County own, control and maintain these improvements. THF. RM 5 ZONED AREA Without the drainage improvements, no work can commence within the RM 5 zoned area. This area is incrementally zoned and consists of approximately 70 acres of land. Due to this condition of rezoning, no work in the RM 5 zoned area has taken place since the last annual repon in 1998. lts status remains unchanged pending drainage system approval and permits. Any change to this status will be reported in future annual reports. SUMMARY Present market conditions show the first improvement in the real estate market in West Hawaii over the past eight years. This marks an important first step in the recovery of the area. 2000 is an important year for Kona Vistas. If market conditions continue to sustain current sales volumes, Gamrex will be in a good position to complete the Unit 2 improvements in the RS 15 zoned area. The increased market activity has not established itself securely, and it will be carefully monitored during the second and third quarters of Annual Progress Report Page Five 2000. Gamrex is moving forward with this market with hopes that it can recapture some of the losses it has sustained over the past years, and gain profitability for the development. Its commitment to Kona Vistas has not wavered. Should any additional information be required, please contact Gregg Kashiwa, Project Planners Hawaii at (808) 329-9724. This annual report is respectfully submitted on behalf of Gamrex, Inc. on this 25"' day of February 2000 as part of its conditioned approvals. Respectfully~~ 4- - Gregg Kashiwa cc: Gamrex, Inc.