Kukui'ula - Another developer challenged by the Recession

Kukui'ula, which covers 1,010 acres between Po'ipu and Lawa'i Valley on Kaua'i's southern shore, is a luxury community planned for 1,200 homes, an 18-hole golf course, a resort spa, 75,000-square-foot commercial village and a 31-unit boutique hotel.

Described as "Kaua'i's Living Garden," the plan also includes $85 million in landscaping, a 20-acre lake, trails, a 5-acre beach park, a 20-acre community park and an 8-acre farm staffed by a resident horticulturist.

When the project was first released, the "founders" secured deposits for lots with a $50,000 commitment. Over 300 lots were reserved but not everyone followed through as the speculative climate for land began to deteriorate in 2006. Some of The lots in Kukuiula sold for upwards of $3 million for a 3/4 acre lot when the market was in a frenzy. Now, as sales have slowed, and the general climate for land purchases on Kauai has been compromised by the economy, comes word about Kukuiula's future.

According to General Manager of the project, Richard Holtzman"As the economic crisis has deepened in recent months, we have recognized we must plan for an even more protracted downturn," Holtzman said in a statement.

"The total capital needed to sustain the project will obviously be affected by the length and severity of the current recession. Thus, we are evaluating the long-term outlook, refining financial planning assumptions and discussing the best approach to meeting the growing capital needs."

Just goes to show you that our economy's downturn is effecting every nook and cranny of our market, even the developers with seemingly the deepest pockets.
The shopping center which is one small piece of the project, is just about completed and expected to open this summer. It is long overdue for more shopping and amenities in this most popular tourist destination on our island. I hope the shopping center stays on schedule. As far as the long term prognosis goes, without a financial partner, it may prove difficult for A&B properties to continue on.

Read the entire story from today's Honolulu Advertiser

There are also several lots for resale from the original buyers. If the project goes on hold, the lots prices may come down significantly.