Kauai Real Estate Update- On this last report of 2025 we’ll see what Sold, was Just Listed and what went Under Contract last week on the island of Kauai. To see that information click here: Kauai Real Estate Update December 22 to 28, 2025.
For the leasehold Kiahuna Plantation click here: Kiahuna Plantation Current Market Analysis
Hawaii’s Green Fee Gets The Green Light
The Federal Cruise Lines International Association sued the State of Hawaii after Act 96 was passed. The Act allows, for the first time, the State to collect TAT for cruise ship passengers. Starting January 1 2026, the TAT will be raised by 0.75% to 11% and by taxing cruise ship passengers the State is expected to collect $100 million annually for both cruise ships and other types of lodging across the State.
However, a U.S. District Court Judge rejected the claims which allows the tax to take effect this Thursday for cruise ship passengers. While the Judge did say that the legal issues involved raise serious questions, the cruise ship industry and the Federal Government had not shown they would likely win the lawsuit and stopping this law would be providing preferential treatment to the Cruise Ship industry.
This case is tricky because it involves the “Tonnage Clause” which is not often litigated and that Federal Courts don’t often interfere with individual States tax systems. It remain to be seen if this is filed in a higher court.
Kauai Coffee Company Land Lease Under Discussion
Discussions are being had between Brue Baukol, the owner of the land that Kauai Coffee Company is on, and the Italian firm Massimo Zanetti Beverage Group the operator of the farm on the “potential of a future lease”.
☕ Kauai Coffee Company employs 141 people, has been in business for 40 years and is the largest coffee company in the United States.
☕ Brue Baukol Capital Partners bought the land and two hydroelectric power plants from A&B in 2022 for $74 million.
☕ Massimo Zanetti Beverage Group bought the farm, but not the land, from A&B in 2011 for $14 Million.
What is being discussed and what will ultimately happen is not known however, CEO Chad Brue stated: “We know how important Kauai Coffee is to our community, for agriculture, local jobs, and economic stability, and our priority is to continue caring for this land responsibly for the future.”
Maui Bill 9 Passes, Phasing Out Vacation Rental Properties
Bill 9, which will phase out 7,000 vacation rentals into long-term housing over the next 5 years, was passed with a 5-3 vote. On the heals of that was to be a second bill to rezone 4,500 of those units to hotel use but that vote got postponed to a January 5th meeting. The bill was introduced in May of 2024 and since then emotional arguments for and against have been heard from locals, hotel workers, realtors, property owners and fire survivors.
How we got here. After the Maui wildfires Bill 9 was introduced on Maui that targeted the grandfathered status of properties on the “Minatoya List” which was created in 2001. The properties on this list were grandfathered for legal short-term rentals even though they are zoned as apartments (A-1 or A-2). There are over 50 condominiums on this list in the areas of Kihei, Kahana, Napili, Maalaea and Lahaina. To see the list of properties on that list click here: Minatoya List
About 4,500 of the properties on this list were deemed to be too costly for locals to rent or own, prone to sea-level rise or more set up as vacation rentals and not conducive to full time living. Couple that with possible lawsuits. The solution was to rezone but with the talks stalling out that decision was postponed but…not before the first lawsuit was filed by a group of owners at Ka’anapali Royal condo complex which is suing the county for “wrongful, oppressive and unreasonable” conduct.
Nothing is happening overnight. The condominiums on the Minatoya List will still operate as short-term rentals until January 1, 2029 in West Maui and January 1, 2031 for the rest of the county.
Possible Gated Community Vote In 2026
A proposal being considered for Kauai voters in 2026 is the “Prohibiting or liminting gated communities within the county.” Kauai would be the first island to adopt such a policy. The intent is to preserve public access to beaches, shorelines and mountains.
