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Hawaiian island awaits future under new owner, Oracle billionaire Larry Ellison

Tourists explore the Four Seasons Resort at Manele Bay on Lanai, the smallest inhabited island of the Hawaiian Islands. Larry Ellison has bought the island from another billionaire, but what it means for this beautiful yet divided place is anyone’s guess. 

New York Times

Tourists explore the Four Seasons Resort at Manele Bay on Lanai, the smallest inhabited island of the Hawaiian Islands. Larry Ellison has bought the island from another billionaire, but what it means for this beautiful yet divided place is anyone’s guess. 

LANAI CITY, Hawaii — Lanai should be the very picture of tropical tranquillity, the kind of Pacific island where Gilligan set ground.

Just 3,135 people live on its 141 square miles. There are no traffic lights, movie theaters or bakeries. It has just one gas station and three main roads. It is ringed with vast and empty beaches, accessible only by four-wheel drive. A visitor can roam its hills for hours without encountering another living being.

Yet for all its seeming serenity, Lanai — a privately owned island in easy sight of Maui's western shore — is torn these days by economic and cultural conflict, struggling with its identity and an uncertain future after its reclusive residents learned that their island had been sold to the reclusive billionaire owner of a software company.

Since James Drummond Dole bought Lanai from a rancher 90 years ago, the island has undergone a series of wrenching economic transformations.

Under Dole, it became the world's largest pineapple plantation, bristling fields and a colony of workers. When Dole moved its operations overseas in the late 1980s, Lanai turned to tourism, opening two high-end resorts.

But when those resorts struggled with the recent economic downturn and the challenge of bringing tourists to a remote island with single-propeller air service, the island's owner proposed building a field of 45-story turbine windmills, across bluffs and beaches covering nearly one-third of the island, to produce energy to sell to Oahu.

The plan polarized residents, dividing those who saw the turbines as the economic salvation of their struggling island from those who treasured its wild and undeveloped isolation.

"It's awful, just awful," said Robin Kaye, one of the opponents, sweeping his arm across the land where the windmills would rise, a tumble of otherworldly rock formations framed by views across the Pacific to Maui and Molokai. "There are families who won't talk to each other anymore. It has really ripped us up."

Lanai's new owner is Larry Ellison, a co-founder of Oracle. He bought 98 percent of the island — the remainder is government property and privately owned homes — in June from David Murdock, another billionaire, whose holdings include Dole and who was the force behind the windmill proposal. The price was not disclosed.

For all the speculation about Ellison's intentions — the most prevalent being that the new owner, whose team of yachts won the America's Cup in 2010, would turn Lanai into a hub for sailing — he has yet to appear in public, speak with elected officials or tell anyone what he might have in mind. He did not respond to a request for comment.

''Everybody is basically in the dark," said Mary Charles, who runs Hotel Lanai.

Alberta De Jetley, publisher of Lanai Today, a monthly newspaper, said islanders were feeling measured hope after the turmoil of Murdock's reign. "We have a wonderful island," she said. "We just need a little help."

Not surprisingly, given the history here, the welcome mat is not entirely out.

"Hey, Larry!" Sally Kaye, a former prosecutor and Robin Kaye's wife, wrote in an open letter to the new owner that was published by Honolulu Civil Beat, a news site. She described Lanai as an island that had "been owned and exploited by one really rich guy or another" for 150 years and whose residents live in a "medieval lord-of-the-manner system of control."

Murdock's tourism push had been a bust, she wrote, "in part because we have very little water on Lanai. I'm sure your due diligence uncovered that little factoid, yes?"

''We (who live here, this being our only home) don't view this as a negative, it's simply a limitation on uncontrolled growth, which we see as a good thing," she wrote. "Hope you do, too."

Charles said she was "appalled" at Sally Kaye's letter and published her own welcome to Ellison in the Honolulu Star-Advertiser.

"There is a small group here that is still very antigrowth and scared of future development," she said over breakfast in her hotel dining room.

For all the mystery surrounding Ellison, the change of the feudal guard seems to offer the prospect of a new start for the island.

Ellison's associates describe him as drawn by the romantic mystery of a secluded island and said it was unlikely that he would embark on any project that might alter its character. His assistants have told people here that he intends to do a major renovation on the two resorts, suggesting that he sees the island's future in tourism, and described this as "a passion purchase."

Charles represents a segment of the island that views modest growth as essential to its survival; the island's population, she said, should be closer to 5,000 people. And she is open to the idea of the windmills.

"They are not wonderful," she said. "The first month or two, it will be, 'Oh my God, those windmills.' And then a year later, it will be, 'Oh yeah, the windmills are over there.' "

Robin Kaye, 65, has lived on Lanai on and off since 1974 and celebrates an existence where supplies come in once a week by barge and people routinely take a ferry to Maui to shop.

''One of the keys here is to promote tourism," he said. "But to do it in a way that is sensitive to what we are: We are a beautiful, small and unique Hawaiian community. We are not Waikiki."

Charles said the remoteness made it harder to run a business, and that people here "would welcome more development — in the right manner."

''Ellison might have saved our community," she said. "We were dying. The situation was at near crisis. Some of the local people don't want to believe that."

Hawaiian island awaits future under new owner, Oracle billionaire Larry Ellison 08/30/12 [Last modified: Thursday, August 30, 2012 4:30am]

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