North Shore farmland being carved up for crop, housing use

David Taogoshi isn’t your typical Hawaii real estate agent.

The 80-year-old head of Aiea Realty Inc. oversees traditional home brokerage transactions, but is also busy with five North Shore farmland subdivision projects that make him a divisive figure.

These projects, covering roughly 700 acres in Waialua between Poamoho and Mokuleia, are examples of property development that has long troubled local government policymakers and riled proponents of preserving farmland for farming.

Yet the spry octogenarian developer also is praised by farmers.

Some North Shore community leaders complain that Taogoshi is driving up the price of farmland by acquiring 30-acre to 300-acre tracts of former sugar cane and pineapple plantation fields for relatively little money and dividing them into mainly 2-acre and 5-acre pieces for sale as attractive home sites.

Part of this criticism is that Taogoshi is enabling proliferation of “gentlemen farm” estates featuring million-dollar homes with little, if any, commercial farming.

Such concern has arisen in part because Taogoshi’s projects are developing out of public view — behind locked gates and without neighborhood board presentations or government public hearings through an unconventional way he advances the projects by selling interests in small parcels before subdivision approval that would allow one or two homes per parcel.

Taogoshi also is recognized for his initial foray into subdividing farmland in the 1990s, when he established 15 5-acre lots known as Poamoho Estates that were sold using marketing phrases that included “Build your dream home.”

On the other hand, some farmers say Taogoshi is prompting diversified farm growth on long-fallow fields by making small plots available at reasonable prices that start at $300,000 for 2 acres and range mainly from about $500,000 to $800,000 for 5 acres.

It’s hard to know for certain, but the reality could be a blend of the conflicting views.

Currently, no more than than two homes are allowed per project, or 10 homes for all 700 acres. But it’s possible that a few hundred homes could legally sprout with city subdivision approvals Taogoshi aims to obtain.

On a recent tour, Taogoshi pointed out considerable farming and preparation for farming on the five sites. He said his projects foster farm formation, maintain the character of rural communities and allow farmers to protect their crops from theft by living on the land.

Taogoshi also disagrees that he’s developing subdivisions for gentlemen farm estates.

“That terminology should be tossed out the window,” he said. “You should use ‘multi-income farm families.’”

The developer’s preferred term refers to households that engage in farming but derive primary or supplemental income outside of farming. He said such folks are largely his buyers and that they are serious about agriculture.

At a 112-acre project in Poamoho called Kaala Ainalani Estates with sweeping distant ocean views, immigrant farmers were raising vegetables on a 5-acre plot Taogoshi said was bought by an airline pilot.

“These are very productive guys,” he said. “They are producing food.”

Another plot owner runs a tile company and plans to grow hemp, according to Taogoshi.

Marigold Zoll, Oahu branch manager for the state Division of Forestry and Wildlife, is another Kaala Ainalani plot owner.

Taogoshi bought the 112 acres from pineapple producer Dole Food Co. in 2014 for $5 million. Over the past two years, he created and sold 19 mostly 5-acre land condominiums mainly for $600,000 to $700,000 apiece — or around $12 million in total — and is spending some of the proceeds to put in paved roads, utilities and other things needed for the city to approve a subdivision establishing fee-simple lots where each lot owner could build a home or two.

Other parts of this site are planted with banana, papaya, avocado, betel nut and breadfruit trees.

“Looks pretty good, no?” Taogoshi said. “It’s not fake farms.”

However, unauthorized residential use also has occurred on some Taogoshi project sites.

The city Department of Planning and Permitting issued a violation notice for putting up yurts at Kaala Ainalani without permits. DPP also issued a violation notice at another Taogoshi project for occupying a container.

Taogoshi touts future prospects for each parcel buyer to build a home or two, but he informs owners through property sale documents that only farm structures can be built until the subdivision process is complete unless a parcel buyer obtains rights from him to have one of the two allowed homes on the unsubdivided project site.

However, marketing materials for two Taogoshi projects called Kawaihapai Farms and Mahiko Farms suggest that parcel buyers can build yurts, container homes or tiny houses before subdivision approval.

Kawaihapai Farms covers 186 acres next to Dillingham Ranch that Taogoshi bought from Dole for $6.4 million in 2016 with a handful of initial investors who acquired condo units in the project slated for subdivision into 58 lots.

Mahiko Farms covers 333 acres near the old Waialua Sugar Mill that Taogoshi bought from Dole sister company Castle & Cooke for $7.5 million in 2017. On this site, the developer has sold tenants-in-common interests representing about 75% of the land to about 35 buyers for $20 million.

Taogoshi’s other two projects are Kaala View Farm Lots #1 with six 5-acre land condos on 31 acres, and Kaala View Farm Lots #2 with nine 5-acre land condos on 53 acres. These two sites are close to Kaala Ainalani.

None of the five projects has subdivision approval, though Taogoshi has installed road and utility infrastructure at the two Kaala View sites and is preparing the other sites for such work.

Milton Agader, a former Waialua Sugar Co. worker who established Twin Bridge Farms about 20 years ago on about 280 acres in Haleiwa and Waialua, credits Taogoshi for allowing him to buy 100 acres of what he used to lease in Waialua on what is now part of Mahiko Farms where Agader grows asparagus, sweet potato, seed corn and other crops. He said land ownership helps ensure his farm’s future.

“If we don’t create these kinds of lots, all the small farmers — they have no place to farm,” he said.

Frank Hinshaw, who bought three 5-acre Kaala View lots and is raising queen bees and close to 350 fruit, nut and spice trees, said farmers on Oahu wanting to buy a few acres don’t have many options because fallow former plantation parcels are too big.

“David is about the only game in town,” Hinshaw said.

Still, much of what concerns farmland subdivision critics is the city’s policy to permit homes on ag land based on a farm plan without regard to a farm being developed or kept in operation. This, they say, can lead to lots being pretty much valued for housing.

At Taogoshi’s first Kaala View project, a buyer who paid $554,250 for a condo lot in 2010 and built a home in 2014 for an estimated $325,000 listed the property for sale in 2016 at $2.65 million. Now, it’s in escrow after the asking price was reduced to $1.69 million.

There isn’t much mention of a farm in the listing description: “Beautiful custom design home with high ceilings and large covered veranda on over five acre estate. Site is mostly level with nursery plants and exotic fruit trees.”

Kathleen Pahinui, chairwoman of the North Shore Neighborhood Board, said community members are concerned about losing farmland to residential use without farming.

“The community feels very strongly that ag land should be used for ag purposes,” she said.

Doug Cole, a board director of the nonprofit North Shore Community Land Trust, said investor demand for Taogoshi’s farmland lots scares him.

“There need to be changes to laws and regulations if people don’t want this to happen,” he said.

Hawaii lawmakers passed a bill last year instructing DPP, the state Office of Planning, state Land Use Commission and state Real Estate Commission to study subdivision and condo laws as they relate to Oahu farmland.

The agencies endorsed the bill, which became Act 278 and calls for a written report by the end of next year to identify any deficiencies and potential remedies.

>> READ MORE: Many farm subdivision lot buyers aren’t typical farmers