The 18 holes at Royal Kunia,By Tim Ruel
built in 1994, go for
An 18-hole golf course in Waipahu, finished in 1994 but never opened to the public because of an outstanding $13 million debt to the city, has been sold for $11.5 million.
Royal Oahu Resort Inc. sold the 163-acre Royal Kunia Country Club to Liongain Hawaii Inc. last week, according to state Bureau of Conveyances documents.
Liongain has two Japan-based directors, Kazumi Iida and Junichi Miyagi, and one local director, Alexander Yoo.
Liongain, incorporated locally in March, lists Yoo's Honolulu-based real estate investment company, Lexon Inc., as its business address.
Yoo could not be reached for comment yesterday. The property had not been listed for sale.
Described by several golf experts as one of the best courses in the state, the Royal Kunia Country Club has been through foreclosure, receivership, and came close to being condemned by the city.
Royal Kunia's lush, manicured greens, with panoramic views of Diamond Head, Pearl Harbor and both mountain ranges, has gone unused because of a controversial $25 million fee Royal Oahu agreed in 1991 to pay the city for the course's impact on the neighborhood.
Then-Mayor Frank Fasi had called the fee shrewd business. Critics called it extortion.
Royal Oahu did pay the city $10 million, along with $2 million to the Waipahu Community Foundation, but did not pay the city the remaining $13 million. As a result, the company could not get the permits needed to open the course.
The property's Japanese lender filed a foreclosure suit on Royal Oahu and its two Japan-based parent companies in 1994, claiming the developers had defaulted on $95 million in promissory notes. Then the lender filed for bankruptcy.
To encourage a buyer for the property, councilwoman Rene Mansho tried to eliminate the remaining fee for the property's permits last year, but her proposal got stuck in committee, where it remains today, Mansho said.
Five other council members signed a resolution to condemn the property, claiming the state's poor economy would lead to a reasonable price for the city to buy it.
Now that Liongain has bought the property, the company plans to open the course for public use, according to filings with the state Department of Commerce and Consumer Affairs.
The company must either pay the city the remaining $13 million to get permits, or approach the City Council about lowering the fee. Liongain officers have not yet approached Mansho, she said.
Mansho called the sale encouraging because the golf course would create jobs and economic activity for the region.
The country club's owners have still not built a permanent clubhouse, and Liongain could elect to build one.
Royal Kunia Country Club has the potential to make lots of money, said Tom Haynes, president of the Golf Media Association of Hawaii and a free-lance golf writer.
"Of course, there are the benefits and tax revenue as well, which, gee, I think we've missed for six years now," Haynes said.
A bad side to the deal, however, is that Oahu's golf courses are already underplayed, and another open course would further divide the pool of players, Haynes said.
Royal Kunia is one of 15 courses in the Leeward area and about 80 courses statewide.