Sales of commercial real estate soar

A renewed appetite for buying commercial property in Hawaii this year has reversed four years of decline, according to a report released yesterday.

The tally surpasses the $628 million in sales for all of last year, a low not seen since the early 1990s.

Colliers, a local commercial real estate firm, said transactions are on pace to exceed $1.25 billion for the full year.

The projection seems close to a sure thing given that an investment partnership completed its purchase of Pearlridge Center yesterday for $245 million.

Also yesterday, Aloha Pacific Federal Credit Union and CUSO of Hawaii Services LLC said they purchased the Central Pacific Bank Kaimuki Plaza building at 3465 Waialae Ave. for $20.8 million. And last month, a Japanese company bought the former Bank of America building at 1357 Kapiolani Blvd. for $31 million.

The rebound puts commercial property purchases at a three-year high but still lower than the $3 billion in sales for 2007. The recent peak was almost $4.3 billion in 2005.

Colliers said the rebound is part of a national trend driven by growing sentiment among investors that the bottom for commercial property prices has been reached.

"Opportunity funds that had been sitting on the sidelines waiting for a flood of distressed properties to be offered for sale are now concerned that they may have missed the market," Colliers said in its report.