Kamehameha trust gains $600M

Its annual report cites the appeal of a city leasehold ordinance protecting its income

During fiscal 2005, Kamehameha Schools grew the market value of its endowment by more than $600 million, to $6.8 billion.

In its 2005 annual report released yesterday, the schools said, "The endowment was also strengthened with the appeal of Chapter 38, the city ordinance allowing condemnation of multifamily leasehold lands."

According to the report, which covers the year ending June 30, 2005, Kamehameha manages the land leases on more than 3,100 single and multi-family homes in Hawaii, which generated a net income of $100.8 million last year.

Kamehameha said its $84 million investment in renovating the Royal Hawaiian Shopping Center in Waikiki and the development of about 51 acres of commercial property it owns in Kakaako will "ensure that our endowment stays strong for many years to come."

As Kamehameha has built the income and asset side of the trust, it has also worked to extend educational opportunities through its "campus-based, community outreach and scholarship and financial aid programs."

For the year ending June 30, 2005, the trust spent $222 million on educational programs, up from $221 million a year ago. Of that, about $118 million was spent on campus programs and $50 million on community-based outreach programs. The balance of $54 million covered capital projects, repairs, interest on debt financing and other related expenses.

A year ago, $112 million was spent on campus programs and $40 million on community outreach programs. But with construction of new campuses ongoing, $96 million was spent.

More than 5,100 students were enrolled in the campuses at Kapalama, Maui and the Big Island for 2005. More than 1,800 children were served in preschool programs and another 13,000 through various extension programs. About 2,600 high school graduates shared $14 million in scholarships.

Kamehameha also contributed more than $1.65 million to the Ho'okako'o Corp., an independent nonprofit organization that operates public schools that have converted to charter schools. The money primarily went to two charter schools: Waimea Middle School on the Big Island and Kualapu'u Elementary School on Molokai. Combined, the schools have 850 students, of whom 60 percent are native Hawaiian.

Kamehameha was established under the 1884 will of Princess Bernice Pauahi Bishop, who left her wealth of 375,000 acres of royal lands -- then valued at about $474,000 -- in a perpetual trust to build and operate the Kamehameha Schools, which educate children of Hawaiian ancestry.