02-13-2009, 06:41 AM
Leasehold agreements vary, the state ones have the ability to increase the yearly lease rate, normally with a cap... so your future costs have a ball park... there is also property tax to pay... and the state usually does NOT pay for improvements... and any improvements are supposed to be approved by the state agency (this can get into "asking forgiveness rather than permission, as Bohnett did at Pu'u Wa'awa'a...) sometimes there are penalties to pay on improvements made.... depends on the lease...
The problem with a leasehold with only a decade or so is that capital improvement write-offs are limited... Also the state has not granted early lease extensions on some of their industrial lands in Hilo, thus limited capital improvement on many of the buildings that have a decade or so left on the lease (this explains the condition of many of the industrial park buildings in Hilo... & is one of the reasons some of the companies have moved to Shipman Industrial..)
ETA: the lease rate is probably not $500, probably not even $500/acre in that location, but could be...
HHL is negotiating with Target/Safeway for an industrial lease agreement that is almost 1,000 times that rate...
The problem with a leasehold with only a decade or so is that capital improvement write-offs are limited... Also the state has not granted early lease extensions on some of their industrial lands in Hilo, thus limited capital improvement on many of the buildings that have a decade or so left on the lease (this explains the condition of many of the industrial park buildings in Hilo... & is one of the reasons some of the companies have moved to Shipman Industrial..)
ETA: the lease rate is probably not $500, probably not even $500/acre in that location, but could be...
HHL is negotiating with Target/Safeway for an industrial lease agreement that is almost 1,000 times that rate...