PBS to buy
Waikiki site
The Hawaii Public Television Foundation, operator of PBS Hawaii, plans to buy a vacant lot next door to Hard Rock Cafe in Waikiki for $2.5 million.
Hawaii Public Television is buying the property from the bankruptcy estate of imprisoned financier Sukamto Sia, according to a document filed this month in U.S. Bankruptcy Court.
PBS Hawaii, formerly a state agency that went private in July 2000, is currently located at the corner of University Avenue and Dole Street, across from the University of Hawaii-Manoa campus. PBS Hawaii has been leasing its 28,000-square-foot station from the state since PBS went private, and the lease is scheduled to run through the end of 2005.
It's no secret that PBS Hawaii has been looking for a new home, though the purchase agreement raises questions about its financing plans, since the station has said it expects its operating budget will drop 7.6 percent to $4.9 million next year from $5.3 million last year.
PBS Hawaii recently laid off four people, reducing its staff to 28 employees from 32, part of cost cutting. When the station was a state agency, it had as many as 75 employees, before state budget cuts.
The Waikiki site, known as the VFW Lot, is 28,761 square feet, and PBS Hawaii will pay about $85 a square foot, if the sales agreement goes through as planned. The land is located at 1812 Kalakaua Ave.
Mike McCartney, a former state senator who is president and chief executive of Hawaii Public Television, declined comment yesterday. PBS Hawaii was expected to make a public announcement today.
Sia's Hawaii Convention Center Partners acquired the VFW Lot in 1994. Sia, an Indonesian investor, also acquired and sold to the state the site that houses the nearby $350 million Hawaii Convention Center.
Sia, who once owned the now-defunct Bank of Honolulu, filed bankruptcy in Honolulu in 1998. At the time, Sia claimed he had nearly $300 million in debts, and assets of only $9 million. Sia later pleaded guilty to bankruptcy fraud and wire fraud in an agreement with federal prosecutors, and is serving a three-year prison sentence.
Japan-based Chuo Mitsui Trust & Banking Co., which holds the mortgage on the Waikiki property, has agreed to release the lot from the mortgage to allow the sale, and will receive the net sale proceeds, according to the filing in U.S. Bankruptcy Court.
Commercial real estate firm CB Richard Ellis is brokering the deal for a 4 percent fee, and its broker, Scott Gomes, will receive part of the fee. Gomes is a director of Waikiki Crossroads Development Inc., the general partner of Hawaii Convention Center Partners, the seller of the property.
Guido Giacometti, the court-appointed trustee overseeing Sia's bankruptcy estate and president of Waikiki Crossroads, has found the broker fee fair and reasonable, according to the filing.
Giacometti has filed a motion seeking court approval of the sale to Hawaii Public Television. The sale does not include a nearby property owned by Hawaii Convention Center Partners.
Seeking money to pay Sia's creditors, Giacometti has sold other Sia properties in recent years, including an undeveloped 1.6-acre parcel atop Maunalani Heights on Oahu, a Singapore apartment and Sia's posh estate in Bel Air, Los Angeles, which fetched $4.6 million.
