 and land in Hawaii with Dennis Isaki on Tic-Tac-Away. Today we'll be speaking with Scott Nunokawa, a housing developer, contractor, consultant, filter, among other things. I first met Scott when he was working with Sea Brewer when they owned a part of Kaloko Reservoir a long time ago. Maybe I'm not supposed to talk about that, Scott. No, I got it. It's a painful memory, but what are you going to do? He also is a founding member of a non-profit called Kaipu Kukui Fellows, helping the younger generation. We'll learn more about it later. He's married to Anani Lem from my hometown of Anahola, Kauai. Scott, welcome to Tic-Tac-Away. Thanks, Dennis. Please tell us a little more about your background and how you got into housing. Sure. Well, first let me start by, I don't really like talking about myself. You asked me to come on the show. It probably is important that I give a little bit of background because that way at least people have a framework why I have some sort of knowledge about a little bit with regards to the issue of housing. So my degree actually, I'm a proud graduate of UH Manoa with a degree in finance in the early 1980s. And I went to work right out of school for a small developer who at that time was doing historic renovations of buildings in downtown Honolulu. And we take the buildings, we renovate them, and lease them out. And I basically did every job imaginable. We kind of pivoted from there into the housing market. And in about 1988, I had an opportunity to move to Maui, which had always been my goal. I had spent a lot of time growing up on Maui to work with a developer by the name of Jesse Spencer on some projects in the Kihei area and spent a number of years down there doing that. And again, kind of because this wasn't big entities, my background was just diverse from finding land, figuring out what the zoning is, getting entitlements and that sort of thing to literally to customer service, turning over keys to people and whatnot. And I found that kind of middle of the bell curve housing, workforce housing, affordable housing, call it what you will, really something that I wanted to be doing with my life. I feel like everybody, they work in part because everybody needs to put a roof over their head and food on the table. Hopefully, if you're lucky enough to have kids to be able to educate them, et cetera. But if you're real lucky, you have an opportunity to participate in something that does your heart good as well. And I found that building housing for, particularly for what I call local folks or workforce housing was something that I really enjoyed doing. Before you went to work for Seabroor? Yeah, before I went to work for Seabroor. I actually went to work, Seabroor actually reached out to me because of the work I had been doing with Jesse Spencer because they had some projects coming up that they needed project management. And that's, if I had to say any one thing, I would say that that's probably what my background is, is project management. So my eldest was newly born and I looked at the opportunity at Seabroor and it provided a paycheck. I wasn't going to get wealthy, but it provided a paycheck and it provided medical insurance. I was going to be able to pay my mortgage. Cool. I'll go do that for a while. And it was a very interesting experience there. I touched on quite a bit of housing. I started to do the math and whatnot and I probably had some involvement, whether it's early planning or the production thereof of literally thousands of houses. The sad part about it is that in that time, I probably 10 times that many was in some level involved with things that were never produced. For all sorts of different reasons, some of which are some of the issues why we have the kind of housing crisis that we have today. From there, Seabroor was really struggling for a variety of different reasons. Part of it was the structure of when they went to become a publicly held company. But when my new boss came to me and said, you know what, we're going to promote you and we're going to make you basically a realtor to sell off parcels of our land. I said, that's just not what I'm interested in doing with my life. I'm here to produce housing. If I can't do that, it's time to find other opportunities. Very shortly thereafter, I was contacted by Amfac. Didn't they sell off the whole company? When I got moved to this new role, I actually sold two parcels that were part of our critical parcel inventory to other parties. I was also put in charge of the work that you and I did together, briefly and plenarily, on the expansion of Kauai Ridge on Kauai. I was told to put that on the market as well and ultimately that was sold off as well. After I left the company, the company was actually renamed to Hawaii Land and Farming and then sold to Stanford Car. Then it's gone through a couple of iterations but that was kind of the end of it for me with regards to Seabroor. Then I went to, like I said, I was approached by Amfac because they actually had an ambitious goal of trying to plan for the future of Konopali Resort. We're talking thousands of acres surrounding the resort. It appealed to me because they really seemed very committed. By then it was a Chicago J&B owned them. It's a Chicago-based ownership at this point. They had gone at the time that I was brought on, they had gone literally a decade without getting any kind of an entitlement permit for any of their lands. I was asked to try to help provide a community-based planning process that was really engaging the community versus you have little charrettes and people get to pretend they think they're involved, et cetera, but they're really not. It actually was, in spite of the fact that I ended up leaving the company, it really was one of the things that restored my faith in if circumstances are set up properly. You can get a broader community to head in the same direction and do the right thing. There was a lot of really good early planning work for that which included literally thousands of affordable or workforce housing units that sadly to this day, this is 20-plus years ago, still have not been produced. I think I worked on some on Kauai cutting out the home sites for the plantation workers and the plantations on Kauai. This is not a negative assessment of J&P. There's lots of reasons why this didn't occur. But we did have a platform and a means of engaging the community that actually was better than I had seen in probably my entire career, quite frankly. At that point, for a variety of reasons, I left Amfac and my wife, whose background is in land use, and I decided to form our own company to do some single-family subdivisions on our own. And we did, for, gee, 10 years we did that and ultimately decided that we kind of had enough of particularly anything having to do with entitlement process or that sort of thing. It just became so unbearable and so brutal that it really wasn't worth the toll that it was taking. So you did most of your housing development on your own, on the island of Maui? When I was at Amfac, I had, excuse me, when I was at Seabroor, I had a project on the Big Island, right on the other side of the Wailuku River from Helotown. That was another one, like I said, I spent a lot of my life with stuff that never actually got built, which is part of my frustration. That particular project took over 10 years to get to the point that it was and the entitlement conditions were so onerous that it made the project unworkable. I had a couple of projects on Kauai when I was at Seabroor. Similarly, that was a little bit different in circumstance. That was more market timing and that sort of thing. And quite frankly, it wasn't what I call middle of the bell curve housing anyway. It was, you know, like Kaliwai, the expansion of Kaliwai Ridge, which is more of a gentleman farm estate kind of a thing. So when that didn't go, you know, it wasn't quite as frustrating as some of the other stuff that I've been involved with. But primarily, you know, I've done a couple of projects on Oahu early in my career, but primarily my work has been done on the island of Maui. Yeah. Well, about how many homes would you say you created on Maui? Well, I kind of differentiate between things that I was directly involved with. I mean, in other words, I put a nail in a piece of wood or something of that nature and stuff that I helped plan that ultimately I built. On the one side, I would say that I was somehow actively involved with its creation, probably close to a thousand, either lots or house lots. And then probably three or four times that in stuff that has ultimately been produced that I didn't take it through subdivision and do the vertical or sell the vacant lots kind of a thing. So did you deal with HFDC or the county housing agencies? Funny, you should ask that question. I was actually hired by Seabroor Homes to do a project at the villages of Leili. And unbeknownst to me because I was, you know, I didn't know anything about any of this, right? I went out there and I was told that it was going to be fee simple, sale to residents, X percent needed to be affordable. And we had our project all lined up, et cetera. It's ready to turn be turned over to us. HFDC has awarded the bid to us. And lo and behold, DHHL or more specifically, OHA decides that they have a problem with it. And quite frankly, in hindsight, I understand why, you know, I mean, this was these projects were being done on seated lands. And the ledger had passed a law letting them do this. But there was a fundamental issue with regards to whether or not it is appropriate to alienate seated lands. And therefore, OHA filed suit to stop the project. And I started doing a lot more research into what it was. And I went to my boss and I said, you might as well lay me off or find me other someplace else to go. Because number one, this thing isn't going anywhere soon. And number two, I'm not sure I want to be involved with it. My wife and children are all made of Hawaiian. I'm not positive. I don't think I feel good about that. Let's put it that way. And fortunately for me, CBourg transferred me to another part of the company. And I worked on other projects since then. So I did have extensive, albeit short, interactions with HFDC. It isn't another funny thing because I was on the HFDC part at that time. Yeah. I knew that after the fact. Yeah. I didn't know each other yet. Then they were going to do a master plan community there on each island. They didn't do one on Kauai because then Mary didn't want it. And then went over to the big island and Kiala Kei and coupling on the big island on all. But you understand that I guess went back to the state after she, didn't you guys put in the best back home? Yeah. So the nice thing is that that hundred and, I can't remember, 116 maybe lot subdivision. The subdivision improvements were all in. So what they did is they traded with the HHL for some of their back, what they back owed. So that's actually a DHHL project. So to me, it was one of those things that it worked out really well in the end, in my mind. You know, you got some people on the land, probably in the manner that it should have been done, you know, kind of a thing. Well, one good thing that I think it was the act 15, you get expedited stuff at that time, right? Yeah. So you could get the backbone infrastructure in. Well, and that was part of what frustrated me was that there was somewhere between 10 and $15 million of taxpayer dollars that had been put into the land out there without the issue of seeded lands being resolved. And it just seemed kind of the tail wagging the dog a bit to me, you know, as a taxpayer, it did. But it does also kind of tell you that from where I sit, and of course, you know, my background isn't, you know, as a private entity, you know, kind of thing, that there are things that government can do to help. And there's some things that government can do that they're not very good at doing. Generally, bad things happen as a result of it. And I'm not sure that the complexity of what was going on out there was within the process of what, what government is going to do well, you know, kind of a thing. Yeah. So getting back to things that did work out, get your housing projects. You got to do the planning. I mean, your wife is an attorney, right? So how do you see the planning and permitting process going? Well, when we stopped in about 2010, Honani said, that's it, I'm done. You know, there are for a variety of reasons, not the least of which was it just had become so brutal. And so many people think it's so easy and everybody's getting wealthy beyond their dreams, et cetera. And they feel that it's just fine to attack you, you know, with no basis, you know, kind of a thing. Part of it was that part of it is when you're on your own and you're doing things the way that we were doing them, every project is sort of an all in, you know, the bank wants everything you own put up as collateral. And she said, you know, I'm just not willing to do that anymore. I said, you know, I'm with you, but I view mine as more of a sabbatical than a, you know, anything necessarily a permanence. I've been on sabbatical now for nearly 12 years, Dennis. So it went from that. And every time I check back, because one of the things that working with the Kaipu Kukui group of a fellowship program, every year we do a meeting on land use planning. And I'm the one that specifically sets that particular olivai up because of my background. And it gives me and immerses me back into at least the Maui County land use development process. And in spite of the fact we keep getting further and further behind on our, our housing needs for local residents, it just gets worse and worse and harder and harder. So before we get into the Kaipu Kukui, with all your frustrations, what did your college professor, psychology professor father say? To be honest with you, Dennis, my father lived up in an ivory tower. It was sort of make it go away or something. His strength wasn't necessarily in the pack day to day. Oh, he was teaching. Yeah, he was a college professor. Yeah. Okay. Yeah, you mentioned the nonprofit called Kaipu Kukui fellows. Can you tell us a little bit about it? Sure. It's, it's a basically it's a leadership of community based leadership project program that seeks to reach out to emerging leaders and provide them with some tools and some experiences that can help them emerge into leaders that are making decisions for the larger good of the community versus any one segment of the community. And the program has been going on, our first class was in 2008. So we've been going on for quite a number of years. I'd like to believe we've been pretty successful. We've had over 200 people through our program. Many of them have gone on to use the skills that they found, I think, productively and usefully. We have had a decent amount of success within the community of our fellows. You know, we've had council members. In fact, right now, as soon as it's inauguration takes place, we'll have two council members that are former fellows or once a fellow, always a fellow is what they all say. And it's an experience based process. So we have a series of meetings that last about the program is a year to year program. We take a better part of June and July off. So it's a 10 or 11 month program. And if anybody wants to know more about the program, you just look up kaipukukui.org. And there's, we have a website there and it tells you a bit about the program. And I would encourage anybody on Maui that is of that age group say, our target, we don't require anything per se, but the target is say 25 to 45 years of age. So what does the kaipukukui literally mean? The vessel of light. And what is this? And okay, you mentioned, you know, started to mention some of the projects or topics you guys cover. Yeah, so far this year, we've done a holovai on water. We've done a holovai on economic development. Last month we did it on planning, which in this case means land use planning. We had a big segment on affordable housing with regards to that. We go to the tri-island isles. So we'll be on Molokai in January, February, excuse me. We're actually getting to go back to holovai again this year as well. So the fellows get a better understanding of the broader tri-island or quad-island, if you include koalave, that is part of Maui County. Oh, that's great. I think it's something like what that leadership kawaii, maybe you can touch piece with them when you're over here. Yeah. Yeah, maybe you can share ideas. Yeah, so what else you get going besides your partial retirement? Well, we are kind of shifting gears now. We're basically right now, the immediate is to, we're moving to kawaii. How Nani's family is firmly in Honohola. It's, we want to establish a presence on kawaii in terms of what we're going to do going forward. I don't see, I mean, you never say never, but I don't see myself working in scale anymore. I thought about something in a nonprofit, but the way development works, it's very difficult to get stuff done in a nonprofit format. You've got to borrow the money from somewhere and the bank doesn't like when somebody says, we're going to do this project and we're not going to make any money. They don't have a sense of humor that way. Yeah, so I think that, you know, if there's opportunities for, you know, like a small family subdivision or something of that nature, you know, I have children as well. We have a lot of family on kawaii that are suffering from the same issues that all of our local families are, which is how do you stay in Hawaii? You know, and that is a big problem. I struggle because I think, like I said, we're getting worse, not better. Yeah, on kawaii, we've been fortunate. We've got some of the housing nonprofits, like Habitat for Humanity, they're doing a lot of work. And Maui also. Yeah. The numbers are so small relative to the larger problem. Yeah. Yeah. But, you know, we had some larger projects. Mark development did something here. We've got, I guess the low income housing tax credits, you know, with that, that helps, you know, but like you said, financing the projects, right? And Dennis, don't get me wrong. Any house is better than no house. You know, I'm not poo-pooing on, you know, all I'm saying is I think that it will be for me on that kind of scale, rather than, you know, the 50, 100, 200, 500 homes. Yeah. Kind of a thing. Yeah. So that, you know, those, you know, small, small chunks here and there, I think it's nothing over here. But other than that, we see the, you know, really high end ones selling a lot over here. I don't know if you've checked the market on kawaii. Sadly, as you know, we have been looking at the market, Dennis. Yeah. And the divergence between markets and what happens because of the high end market with regards to some of the other markets is it's, it's that way statewide, but Maui and kawaii are particularly negatively affected. And, you know, recently with the best resident, they've designated kind of the high end portions of kawaii is kind of they get, they had some tax benefits in Koloa and on the north shore of Kauaii. I thought I couldn't figure that one out. Yeah. But, you know, if you had the money to buy it, then you get more tax benefits later. So, you know, for the fuels, that portion of the real estate market. But I don't know if you fit in that category, but not for me. Nor I. Yeah. So you got your children. Around the islands yet. My three children are all on a Wahoo right now. I'm finishing up school and starting their work career and whatnot. I do believe that ultimately, you know, our goal is to figure out how to help them be able to afford to live in housing-wise anyway. I mean, they're kind of on their own as far as how to put food on the table and that sort of thing. But it is something that I think that we can probably help them with on the housing side. They're not developers? No. We tried to discourage that actually. My eldest is an attorney at Legal Aid. I have twins that are in their mid-20s. One is in a medical school program. And the other is making his way in the world after getting his film degree. Oh, that's good. Yeah. You might be a star. Highly unlikely, Dennis. Okay, Scott, do you got any less words or words of advice? Well, the one thing I would say, Dennis, is that if we don't collectively do something to actively fix the issues we have with housing, we really are going to lose our youth. That's just a simple reality. And I think that globally, if we can't figure out how to get people in the canoe paddling at least in a similar direction, you know, I think Kauai and Maui share this in that we don't have a common vision, you know, within our population. And so no matter what anybody proposes, there's somebody trying to throw rocks on the tent. And until we figure out a way of getting people to kind of flow at least in a similar direction, we're going to have a problem. And until government understands what they're good and not good at, and as an active participant in solving this problem, it's just going to get worse. Yeah, thanks Scott. Yeah, thank you. Mahalo to our guest Scott Nunukawa. Mahalo to our viewers on Think Tech Hawaii. If you like this Think Tech Hawaii free media show, please help support this nonprofit platform. Aloha, a hui hou, a la ma pono. So follow us on Facebook, Instagram and LinkedIn and donate to us at thinktechhawaii.com. Mahalo.