Tyco’s $75M
Maili facility
going for $5M
Thought there was no discounted real estate in today's seller's market? Guess again.
Tyco Telecommunications is selling a never-used undersea cable landing station and data center at Maili -- built in 2002 for $75 million -- for the dizzyingly marked-down price of $5 million.
The Leeward facility was intended as a key link in the company's worldwide undersea fiber-optic network. But just after the facility was completed in 2002, Tyco Telecommunications abandoned plans to lay an expensive trans-Pacific cable that would have plugged the Maili station into the global network.
The company, a unit of Tyco International, was hit along with many telecom firms by the global glut of bandwidth capacity built during the dotcom bubble.
This has put Tyco in the odd situation of having to drastically lower the price for a piece of real estate when elsewhere in the market prices are routinely bid through the asking price. The 38,000-square-foot property had languished on the market at $18 million for more than a year, but Tyco recently dropped the price further.
"There is such a limited buyer pool and we felt the price needed to be a little more realistic," said Reese Liggett, the Realtor for Chaney, Brooks & Co., who is handling the sale.
Telecommunications experts said they see little chance of the facility being purchased by a telecom or broadband provider, since current fiber-optic and satellite systems have made it unnecessary to link through Hawaii.
"That is what's called a white elephant," said Craig Landis, head of Kapolei-based satellite uplink provider Vision Accomplished Hawaii. "I think it's very doubtful they'll find a buyer. There's just too much capacity out there now."
The facility's travails have been a disappointment not just for Tyco. The company had billed the site as an employment engine for the local area, said City Council member Mike Gabbard, whose district includes Maili.
"(Tyco) said this would bring in all kinds of jobs and give a shot in the arm to the area," Gabbard said.
Representatives of Tyco Telecommunications in New Jersey did not return calls.
The property is next to the Maili Elementary School in residential zoning, which rules out use as an office building or for general commercial purposes, but allows use by the government, a utility or as a meeting facility, such as a school. Liggett said Tyco would welcome such buyers. He said the property is still filled with a number of large batteries that could be removed as a condition of sale.
Gabbard said he will propose that the city look into purchasing the property as the site for its proposed homeless services center. But even then, Oahu's most marked-down piece of real estate may have to come down further.
"Five million is still a whole lot of money," Gabbard said.
