Question about Honolulu/Diamond Head Leaseholds

[James Mullen]

Hi everyone,

I recently started taking a look at the Diamond head area of Oahu at rentals and keep seeing a lot of leaseholds. However, I keep finding rentals that are leaseholds like this one: https://www.hawaiiliving.com/diamond-head-bch-hote...

I want to make sure that I am estimating the ROI correctly because most the properties I have been looking at appear to end up in a loss. I'm grabbing rental and occupancy data from airdna: https://www.airdna.co/market-data/app/us/hawaii/ho...

Btw, the above assumes a 0% interest rate (these were just quick and dirty calculations). Anyone let me know what I am missing (Other than working to rehab/increase value of the property).

Thanks,

[Michael Borger]

Looks about right -- I would expect a net loss as well. Hawaii's not too famous for its cash flow. You might do better in Waikiki itself than on the outskirts in DH. I've flipped a few leaseholds but only when there was a healthy amount of term left.