Neighbors
lease part of
Fong’s propertyThe former senator's
Kahaluu parcels draw
bids at a state auction
A Kahaluu family yesterday agreed to spend $70,000 for a 17-year lease on the operational center of Sen. Hiram Fong's Plantation & Gardens.
Leonard Wong, 92, and his son Allen, had come to a court-ordered auction prepared to pay more than $1 million for the whole 725-acre estate, but the fee was not for sale.
They ended up buying leasehold rights for two parcels that include the tourist center and three residences on a total of 211 acres. Among its commercial structures are a gift shop and a small fast-food restaurant, both operated by concessionaires.
The rent income from the homes alone more than justifies the purchase price, said Allen Wong, who said the tourist side of the business will be closed.
Mostly, the family was interested in a level of control over the activity in a neighborhood where they live and invest. The Wongs own a nearby community of 70 rental homes.
A half-interest in the other 510 acres of the plantation and gardens went for $35,000 to investor Jere Henderson, who said he owns some land on the Big Island but nothing on Oahu.
Because that part of the property is zoned preservation, land use is limited and he has "no plans at all" for the property, Henderson said.
Bank of Hawaii, which says it is owed about $1 million on the loans that financed the Fong family's purchase of the land, did not bid.
Fong, a former Republican U.S. senator who is now 96, borrowed from the bank in 1987 to buy the land under the garden complex. A mix of intrafamily leases leaves the land still owned by the Fongs.
The Wongs are buying the leasehold interest held by one of the Fong family entities. The land still will be owned by other Fong businesses.
Henderson is buying a 50 percent fee interest in the preservation land, with the Fongs retaining the other half.
Details of the purchases will be worked out over the next 30 days.
The senator's family is embroiled in lawsuits and Hiram Sr. and his wife, Ellyn, filed for federal bankruptcy court protection a year ago. That did not stop the state court foreclosure action.
The plantation and gardens was still operating yesterday, open for tours that include a look at some unique vegetation and ancient lychee trees that may be 100 feet tall.
The facilities at 47-285 Pulama Road are popular for local weddings, birthday parties and other events. The walls of the main building are lined with statehood-era pictures of Fong as a senator meeting with international dignitaries.
Attorney Clyde Umebayashi, the court-appointed commissioner who conducted the auction outside the state Circuit Court, started with bids for the 508-acre preservation parcel.
A bid from Henderson of $25,000 was topped by Clinton Ho, who bid $30,000, but a final bid of $35,000 won the deal for Henderson. No minimum bid was set. For tax purposes the property is valued at $601,000.
The two parcels making up the smaller piece of the property have A-2 agricultural zoning and are valued for tax purposes at $1.6 million. The first bid was $60,000 from the Wongs. Henderson countered at $65,000, but let it go to the Wongs for $70,000. The fee ownership of the land, which was retained by Fong family entities, is the target of Bank of Hawaii's collection efforts.
The Fongs' legal troubles may be one reason there weren't more bids for the parcels.
Allen Wong said he and his father had not understood the lease complications until just before the auction.
When they learned it would be sold in separate parcels, some of which would be leasehold, they nearly walked way, Allen Wong said.
"We only buy fee-simple," he said. "But because the price is right and it is close to our property, it is the right thing to do," he said.
"I know the Fongs have been there a long time. It is a shame it has come to this," he said. But at 92, his father "wanted his peace of mind" about what would happen to the property near his family's earlier holdings, he said.
The fact that it is leasehold is countered by the control the Wongs will have, for the next 17 years at least, over what happens there, he said.
"We have the last say on what it is," he said.
