Back in 1841, Lincoln’s father, Thomas, wasn’t rolling in dough, and a 32-year-old Abraham helped him out by purchasing 40 acres of farmland outside Charleston in central Illinois. At the time, Lincoln was a state representative for Sangamon County (home to state capital Springfield) some 90 miles away. What’s also chronologically interesting is that 1841 was also the time Lincoln called off a marriage with Mary Todd before a reconciliation and the birth of their first child, Robert Todd Lincoln some two years later.
Yesterday, the original 40-acre parcel is now 30, and has for the past 30 years been part of a 590 acre farm that was sold at auction (on Lincoln’s birthday). The Times-Courier and Mattoon Journal-Gazette reports that on Feb. 12, 2019, 560 acres sold for $7,000 per acre, or $3.9 million. The Lincoln 30 acres were sold separately for $10,000 per acre, or $300,000 to an unnamed buyer with unknown plans for the site.
How the 40 acres became 30 is just what happens over time.
Tahitienne is one of the first “high-rises” built on Oahu’s Gold Coast. Originally an eight-story building, a ninth-floor penthouse was added at some point. It rests alone with 2,800 square feet plus an additional 645-square-foot lanai that stretches 50 linear feet across the ocean. There are three bedrooms with two-and-a-half bathrooms. Listed at $6.4 million with Anne Oliver from Coldwell Banker Pacific Properties, it’s a sweet place to call home.
To take advantage of the views, the main rooms slot from left to right along the ocean. Upon entering there is a guest room immediately to the left (more later) but forward is the living room. Next to that is the central kitchen, which is flanked on the other side by the dining room. Beyond the dining room is the full-depth, ocean-to-Diamond Head master suite. If you always want to be looking at the water (and you do), this is the layout. The home was renovated in 2008 by the Los Angeles-based ID Group.
Passing by a long-vacant lot, a sign suddenly appeared heralding the future of six townhouses facing the ocean on Oahu’s storied Kahala Avenue. The lot’s most recent history involves a Japanese billionaire who purchased over 30 homes and lots in this small enclave that he subsequently let deteriorate. Some thought his plan was to degrade the neighborhood so he could buy more at a bargain. Publicly, he boasted of wanting to return this wealthy area back to native Hawaiians by enabling them to rent mansions for pennies. Neither can be proven true. What is known is that many of the neglected properties required razing. Along Kahala Avenue these lots turn a gap-toothed smile to the ocean.
This lot, 4607 Kahala Avenue, is slated for redevelopment. Instead of a single home across its 1.33-acre site, six are planned, which has rankled some neighbors. In truth, there’s only one other multi-family oceanfront development in Kahala, and its leasehold is expiring in 2027.
When I saw the Mandarin Oriental construction fencing go up across from the Honolulu convention center, my curiosity was piqued. First, the Mana’olana Place development isn’t a stellar location. To contradict the marketing materials, it is not “steps from the beach” and certainly not while schlepping chairs, towels and sunscreen. It’s also flanked by a bevy of stripper bars and sits across from the aforementioned convention center that’s far from the beehive of activity promised by city leaders more than 20 years ago.
Being a Mandarin Oriental, you’d expect a better, more chic location. Granted, as Kaka’ako (with its large Howard Hughes development in progress), Waikiki and downtown Honolulu inevitably merge together, the Ala Moana area will be just another part of the city, but that’s years away. Folks buying one of the 99 condos or staying in the 125 hotel rooms are unlikely to want a front row seat to a neighborhood in transition.
It, like Kaka’ako, is unlikely to become a super-vibrant neighborhood either. The new high-rises popping up are not aimed at local residents. They’re almost all ultra-luxury targeting the global elite who may spend a few weeks a year soaking up the sun while their asset appreciates. I have visited several of those new buildings and been told that 10 percent occupancy is average. Like its brethren, the Mandarin Oriental is largely constructing an empty box staffed with low-paid servants waiting for someone to show up.
Overall, the Honolulu Market continues to go from strength to strength, with price increases unbothered by increasing inventory. Often, when inventory rises, prices take a hit as buyers with more choice have increased bargaining room. Not in Hawaii. The only hint of more inventory has been an increase in days on market
For single-family homes, the median time to sell was 29 days compared with 15 days a year ago – nearly double the time. However, for condos, days on market only increased from 21 days last year to 25 days in October 2018. The inventory bump has been welcomed by Darryl Macha, president of Honolulu Board of Realtors.
“The inventory of homes and condominiums available for sale has been rising, providing more options for potential homebuyers and leading to an increase in the days on market,” Macha said. “Oahu’s housing market continues to be a stable environment for both buyers and sellers.”
Honolulu’s Gold Coast is a scant half-mile stretch of oceanfront high-rises at the foot of Diamond Head. You may think that Hawaii has the same unending tonnage of oceanfront high-rises seen around Florida, not true. Within Honolulu, there are just 18 oceanfront residential high-rises. Seventeen are on the Gold Coast, and one in Waikiki. None are newer than 1970, with most dating to the 1950s and 1960s. Typical condos sell between $1,500-to-$2,200-plus per square foot.
Built in 1958, the 12-story Tropic Seas isn’t the toniest building on the street, but that’s where bargains reside. Unit 203 is just such a bargain. The one-bedroom unit has 618 square feet with an additional 121-square-foot lanai. You know there’s a renovation needed when the first listing photo showing the interior is the 13th of 19 photos. But at $499,000, that’s $675 a square foot.
Back in 1982, two oceanfront thirds of an acre caught the eye of a developer who created a four-unit community behind private gates. Called Ku’u Makana it’s located in Honolulu at the foot of Diamond Head crater on the island of Oahu. Each of the four units are identical — 3,536 square feet indoors and another 674 square feet of lanai space.
In the photo above, the demarcation of the units is obvious with the center fireplace chimneys. No, it doesn’t get cold enough to need a fireplace and you’d likely need the air-conditioning cranked if you used it, but there you go. There are left-right and up-down units.
Currently, the two upper units are for sale – one in need of an overhaul and the other already renovated. Unlike a recent gut job I toured in Dallas, with $1.023 million separating the units, the renovation is more than priced into the deal.
Regardless of whom you read, Brexit is having a negative impact on central London housing. An October 17 European Union summit was presaged by European Council president Donald Tusk saying yesterday there is “no grounds for optimism” given the state of negotiations. Coupled with fresh inflation data, the pound was down again. Since the Brexit vote, the pound has almost exclusively traded +/-$1.30 where as it typically had ranged in the $1.50-$1.60 range previously.
Adding to the stress, in early October, two more large financial institutions announced plans to shift some London operations to Paris with whispers of more to follow. Financial services is one of the largest employers in London as well as one of the highest paid. Removing significant quantities of high earners will cause a glut in some price bands as relocated staff sell up for Gay Purr-ee.
During my London holiday, I was able to meet with a host of HGTV’s House Hunters International, Richard Blanco. A Spanish national growing up in the UK, Blanco was schooled in theater and dance – a story common to many real estate professionals whose early interests gave way to a profession in property. So far Blanco has chalked up over 30 House Hunters International episodes, including being the only presenter to work in multiple countries (eagle eyes have seen him in Spanish episodes). He’s currently a spokesperson for the UK’s National Landlords Association and is a regular commentator on various television shows – in fact, Blanco had popped into the BBC earlier in the day. For those wanting a regular dose of the London property market, Blanco produces a monthly podcast Inside Property. In his spare time, Blanco flips homes he buys at auction.