According to a recent report from Colliers International Hawaii, commercial real estate investment activity in our state spiked during the first half of the year. The report stated that with hotel sales leading the charge, total transaction sales volume increased to $2.2 billion, which was 134 percent higher than the same period in 2012.
If this momentum continues, we will hit a new record this year, which is terrific news! Also in the report, Hawaii commercial real estate properties with a value of over $1 million were up by 43 percent compared to the same period last year. A total of 110 of these properties were sold. What a tremendous jump.
Land sales were also on the rise, doubling during the first half of the year, compared with the same period last year. There were 22 transactions for a total of $124 million.
The last record for sales volume was established in 2005 with a total of $4.3 billion. What a long way we’ve come to get back to that point. If all goes well, we will surpass the record, but even if we fall a bit short, there’s still plenty of cause for celebration.
As I mentioned earlier, hotel sales were leading the charge and comprised a whopping 80 percent of the total sales volume during this period. The sale of the Grand Wailea for $774 million was a major contributor, as was The Blackstone Group’s $450 million acquisition of the Hyatt Regency Waikiki Beach Resort & Spa.
As it stands, the forecast for the end of 2013 is a sales volume of over $3.2 billion, but these big purchases can easily push that total above and beyond the expectations of economic analysts like Colliers International Hawaii.
We hope that the current trends continue, especially considering the boost we’re seeing in the job market as a result. More job security means more activity in Maui real estate sales, which we have been seeing with the plummeting of inventory available. Prices are inching up, and we are returning to a seller’s market now that so many properties are back to getting multiple offers.
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