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The Japanese Real Estate Bubble Pops
The late ’80s in Hawaii were a go-go time of easy money. Home values doubled between 1986 and 1990, with Oahu home prices skyrocketing from about $156,000 to $352,000. By 1988, Hawaii ranked second in the nation in business startups. This was mainly because so much Japanese yen flowed into the Islands between 1985 and 1990, you had to have been foolish or luckless not to have some of it stick to you.
Or foolish to believe it would last. The Japanese investments had begun pouring into Hawaii after a double-whammy: First, a 1985 trade agreement weakened the dollar against the yen (ostensibly, to ease a trade imbalance between the two countries). Then, Japanese authorities lowered interest rates at home and flooded the country with easy yen to encourage domestic spending. Suddenly, jetting to Hawaii for $1,200 purses, or an occasional Kahala mansion, was no problem.
The Nikkei 225 stock market average peaked in December 1989, but Japan recognized this was an unsustainable real estate bubble and raised interest rates to put on the brakes. Over the next 12 months, that stock market lost more than $2 trillion in value.
Hawaii’s yen-fueled party immediately ground to a halt. By September 1992, U.S. News and World Report ranked our economy 51st of the 50 states plus the District of Columbia. That’s the same year construction starts plummeted, as Japanese-financed projects were halted. It reminded us that this is a state that doesn’t know how to generate its own wealth when outsiders aren’t throwing cash at us.
Hawaii Regional Cuisine is Born
August 21, 1991
When 12 hotshot chefs assembled at the Maui Prince Hotel for the First Symposium on Hawaiian Cooking in 1991, they weren’t really intending to spark a dining revolution.
“We just wanted to get a bunch of the young chefs together so we could have some fun and talk about food,” says restaurateur Peter Merriman. “I called it a symposium because I looked up the definition and it said it was where a lot of drinking and discussion took place, and I said, 'that’s us!”’
By the time they were done talking, though, they had coined a name for an exciting new wave of cooking that had been taking shape in Hawaii since the late 1980s, using fresh, locally grown ingredients and a gourmet fusion of Asian, Hawaiian and any number of other flavors: Hawaii Regional Cuisine.
Today, the list of attendees reads like a who’s who of Hawaii’s dining elite: Alan Wong, Roy Yamaguchi, George Mavrothalassitis, Peter Merriman, Beverly Gannon, Sam Choy, Mark Ellman, Amy Ota, Gary Strehl, Jean-Marie Josselin, Phillippe Padovani and Roger Dikon. And Hawaii eats better.
Iniki Wreaks Havoc
September 11, 1992
The single most destructive natural disaster to strike Hawaii in recent memory, Hurricane Iniki reminded us how vulnerable our isolated Island chain really is. Although it mercifully veered away from the population center of Oahu, the Category 4 hurricane killed six people on Kauai and caused an estimated $1.8 billion worth of damage ($2.7 billion in 2009 dollars), including the destruction of almost 1,200 homes.
The impact was devastating. “It took us a decade to get our population back,” says Mark Marshall, the Kauai Civil Defense emergency management officer. “We saw a huge business failure and a downspike in property values.”
Even today, the island is full of reminders of Iniki, such as the Coco Palms Resort, which still stands empty, 17 years later, and the $17.7 million civil defense center, built to guard against the next inevitable hurricane. “[Iniki] is always in the back of our minds,” says Marshall.