Commercial real estate had record year in 2005
Investment in Hawaii totaled $4.28 billion last year, a report says
A $700 million jump in investment propelled Hawaii's commercial real estate market to a record $4.28 billion in transactions last year, according to a report released yesterday by Colliers Monroe Friedlander.
Real estate analysts had forecast that 2005 would be a record year for commercial investments, and the market's 20 percent increase didn't disappoint. About 431 commercial real estate transactions were in excess of $1 million, more than a 50 percent increase from 2004, said Mike Hamasu, director of research and consulting at Colliers.
A strong local economy combined with a surging tourism market, a favorable investment environment and a limited supply of top-tier inventory on the mainland contributed to the most robust commercial investment cycle in a dozen years, Hamasu said.
"This dramatic rise in real estate transactions is reflective of the tremendous amount of capital that is flowing into real estate throughout the nation," he said.
Limited inventory likely will prevent 2006 from reaching last year's spectacular sales volume, Hamasu said.
"We'll probably be in excess of $3 billion," Hamasu said.
Last year was a big-deal, big-dollar year, with Hawaii's retail sector outpacing its hospitality, office and industrial sectors for the first time. Among the top retail transactions were Pearl Highlands Center for $109 million, the Town Center of Mililani for $151 million, 2100 Kalakaua for $156 million and Whalers Village for $170 million.
The hotel market followed closely behind the retail sector, recording eight major transactions. Among the top acquisitions were the Waikiki Beach Marriott for $275 million, the Fairmont Orchid for $250 million and the Kahala Mandarin for $176 million.
Hawaii's hot industrial market, the tightest in the nation, recorded one of the most notable transactions of the year with the $116 million purchase of the James Campbell Industrial Park by Massachusetts-based HRPT. The real estate investment trust first entered Hawaii's market in late 2003 with the $450 million purchase of Damon Estate lands.