Retail Center Fetches $445 Per SF

MAUI, HI-The 60,000-sf Kahana Gateway Shopping Center here has changed hands for $26.75 million, or $445.83 per sf. Triple Net Properties of Santa Ana, CA, sold the 96% leased property to Kahana Partners LLC, a group of California-based investors.

The 3.95-acre center is located on the northwest corner of Honoapiillani Highway and Hoohui Road in the district of Kahana. It was constructed in 1990 with a tropical plantation design theme. Tenants include Outback Steakhouse, Roy’s Kahana Bar and Grill, Maui Dive Shop and Whaler’s General Store.

Faris Lee president Rich Walter says the shopping center is attractive because it sits halfway between Ka’anapali and Kapalua, sits in a desirable resort neighborhood and has an attractive demographic profile. David Lee of Faris Lee Investments says the buyer not only offered top dollar but also agreed to put up the 50% down payment that was required.

“It is extremely challenging to find a buyer that can put down half the price of the property on a transaction as large as this one,” says Lee. “Additionally, there was an above market interest rate on the first trust deed which made it an even more difficult transaction for the buyer.”