The flamboyant bigwig, Larry Ellison, the eminent CEO and Co-founder of Oracle, is also the one with most exclusive priced possessions. And to his glorious list, Mr. Ellison has added to his kitty not an estate or a jet or a car, but a complete Hawaiian island of Lanai, better known as the “Pineapple Island”
Hawaii State governor Neil Abercrombie announced Ellison to be the buyer of 98% of the sixth largest Hawaiian island, referring to the transfer papers filed by owner Castle & Cooke Inc., billionaire David Murdock, with the Public Utilities Commission.
Running 9 miles off the coast of Maui, Lanai is the island with smallest number of inhabitants, which is publically accessible. The remaining 2% of ownership is with the state and the residents on the island, roughly 3200 in number. Lanai flaunts two vacation resorts, two golf courses and a variety of residential and commercial buildings. However, it is relatively undisturbed and unspoiled by tourism and development, laud streets and spotlights and the areas are only accessible by four wheel drive vehicles.
Though the exact selling price remains undisclosed, an Industry News reported the asking price for this 138 square miles island sale to be between $500 and $600 million. Even at $500 million, it’s a record breaking transaction, and to add to the awe, the techie is paying all cash for the deal.
Industry News further reports that Castle & Cooke had been pouring more than $40 million a year on Lanai operations. So, if not a profitable one, the 89 year old tycoon, Murdock, was saved off the expenses. While, it is extremely difficult to value a property so huge, considering the high costs, is it a sound investment for Ellison?
$600 million is undoubtedly a whooping number, but for a property as vast, its chump change. Even at an upper limit of $600 million, Ellison has acquired the land at less than $7000 an acre, which makes a sordid 16 cents a square foot. Of course the location, property type and utility plays a huge role in the valuation of a property, yet, with a Manhattan penthouse property selling at as much as $13000 per square foot, the Lanai deal is a steal for Larry. Moreover, for a man with net worth of even $1 billion, it’s like buying a used Chevy Impala.
Though an assumption, Larry Ellison supposedly plans to develop the island and boost tourism. This may further enhance the property value and may as well take Lanai to be a new attraction.
Larry Ellison, the third richest American, according to the Forbes, with net worth of more than $36 billion, is known for his most unusual investments and collections in properties. Some of his bewitching properties include two estates in Woodside, California, a hotel and two restaurants in Malibu along with two other homes, a 249-acre estate in Palm Springs and a garden property in Kyoto Japan. He has not felt oscillating in buying a 454 foot mega-yacht, the Rising Sun, pricy cars, including a Mc Laren F1 and a collection of jets, the Italian Marchetti jet being his favorite. He had put up over $100 million to bankroll a sailing team, and won the America’s cup 2010 and brought the 2013 America’s Cup finals to San Francisco. With such grandiose records to back, the Pineapple island deal does not come as a complete surprise in case of Larry Ellison. He is now used to creating new limits for frantic buying and collections. What will be even more enticing is to see how the Lanai Island radiates in the reign of Ellison.