In my previous post, I wrote that there are lots of Ilikai owners who are really concerned about what is happening and the current Board.  Many owners – those who are informed – would not have anything to do with voting for the current Board of Directors to be re-elected.

If you are sceptical about the above statements, then you should have been at today’s Board meeting.  The general session lasted 2.5 hours and towards the end, got really heated, to put it mildly.

I will post notes, but give me a couple days, as it was overwhelming.

Here is some clarification.  We have now at the Ilikai this OBC group of Board Directors who are also running for re-election.  The OBC stands for Old Boys (and some ladies) Club.  By the way, I am not the one who thought of this term.  It was another concerned Ilikai owner who is concerned about what is happening.  The OBC Directors (also running for re-election) are: Lea Sasak, Bill Moore, Bill Lawrence, Dass Ramadass, and Lavonne West.

This OBC group is actively pitching the argument that goes like this, “We must retain control of the Board.  For that, we need to have four owner Directors elected.  The only way to accomplish this is if you [owners that is] give us your proxies.  We will collect all these proxies and then use them.  No votes will be wasted that way.  That way we will get elected, we will retain control of the Board.  Otherwise, iStar or iStar and Shell will take over the Board, and the world will come down.”

That is a totally BOGUS argument.  Why?  Here is why:  There are LOTS and LOTS of owners who do not want to have anything to do with that group of OBC Directors and will not give their vote proxies to them.  Because these owners got completely disillusioned with this group (e.g., this group has been in full control of the Board for a year now; what have they accomplished?), or they personally dislike the people in that group, or other reasons.  So if that group is the only owner representation choice available, then the disillusioned owners will either not vote at all or vote for iStar.  A lot of owners have more confidence in iStar – or me – than in this group.  That is the reality.

What is the solution?  Here is the solution:  There should be more than one option for owners to vote for.  The OBC group is one option, they do have their constituents.  I am representing the OPPOSITION.  Somebody was trying to talk me into partnering with the OBC group.  That would be exactly the way to lose owner votes, because many owners do not want to be part of that group and their mentality, way of conducting business, and so forth.  My goal is to represent owners who have a different, progressive vision for the Ilikai than what we have seen with the OBC Directors.  We urgently need fresh representation on the Board.  That is why I am putting my candidacy.

Click here for an outline of my vision as a Board Director candidate for the priority areas.

In my and some others’ opinion, perhaps by far the main “accomplishment” of the current Board from March 2009 through now is that they managed to convert – through fierce infighting – the Ilikai Board into an OBC-controlled Board (Old Boys (and some ladies) Club).  The OBC Directors, who are also Board Director candidates pitching themselves for re-election, are: Lea Sasak, Dass Ramadass, Bill Moore, Bill Lawrence, Bob Currie, and Lavonne West.

So what about the “elephant in the room” – the Tokioka Family?

Dass Ramadass is one of the OBC group of Directors and was hand-picked to be elected to the Board by the OBC Directors when the Board had a vacancy this past fall.  Please note that the Board has ZERO representation of the Hotel (owned by iStar), even though the Hotel/iStar own 28% of the Ilikai complex.  iStar did want to have one Director on the Board and put forward iStar’s Senior Vice President, Leslie Love, as a candidate.  But the OBC Directors chose members of the OBC network, Lavonne West, Bill Lawrence, and Dass Ramadass, instead, whenever there was a vacancy on the Board.

Anyway, back to the “elephant in the room.”  One of the OBC Directors and candidates for the upcoming Board elections is Dass Ramadass.  Click here to view Ramadass’s resume that he submitted as a Board Director candidate. 

Folks not familiar with the setup may read his resume and say, “Wow.  VP this, VP that.”  Specifically, Dass stated that he is Executive Vice President/Treasurer at National Mortgage & Finance, Ltd., also Executive Vice President at Mutual Finance Co., Ltd., and also President/Director at Hawaiian Properties.

However, what Dass Ramadass failed to point out is this:

(a) Dass Ramadass himself does not own anything at the Ilikai.

(b) It is the Tokioka Family that owns all those companies where he is employed: National Mortgage & Finance, Ltd., Mutual Finance Co., Ltd., and Hawaiian Properties – as well as Marina Vacations.  Marina Vacations is the sales and rental agency at the Ilikai.  The number of Ilikai units in their program has declined compared to what it used to be.  Nevertheless, it is estimated that to the tune of 250 of Ilikai units are in their rental program.

In other words, Dass Ramadass himself does not own anything at the Ilikai.  He is nothing more than an EMPLOYEE of various companies of the Tokioka Family.

So how come he is a Board Director and how come he is running for re-elections to the Board?  Well, that is because the Tokioka Family owns ONE unit at the Ilikai, under Mutual Finance Co., Ltd..  Please note here: We have searched public records.  The various companies of the Tokioka Family used to own several more units at the Ilikai.  It appears that at this point all they own is unit # 1623.  It is conceivable that they own several more units under some other names, but certainly not more than five or ten units at the very most, for sure.  They sold their other units in recent years (e.g., they sold unit # 309 for $385K on 09/05/2003, which they had bought for $240K on 02/02/2002).

So the Tokioka Family (their Mutual Finance company) appears to own one single unit at the Ilikai (several at most, in case there are other units under other names).  Yet, they get to place their EMPLOYEE, Dass Ramadass, on our Board of Directors, and likely to have him and possibly an additional Director on the new Board.  How come?

Because Ramadass is an officer of a company that owns that unit # 1623. 

But there is more to it.  Even though the Tokioka Family owns one unit (several at most, in case there are other units under other names), upon information and belief, they hold proxies for around 200 Ilikai units at least.  Why?  Because they own Marina Vacations, the rental agency at the Ilikai.  When owners put their units in that rental program, the DEFAULT is that Marina Vacations obtains their PROXY for voting!  Owners can choose to opt out.  But the DEFAULT is that they give away their PROXIES.

The Tokioka Family certainly has some sort of commercial interests here at the Ilikai, beyond simply running that rental agency.  What specifically? – Who knows. 

For ex., one of their companies, Hawaiian Properties, is a management company.  Would the Tokioka Family want to place their Hawaiian Properties here to replace Hawaii First?

But the bottom line is this: Here is this Tokioka Family.  They own one single unit at the Ilikai (several at most, in case there are other units under other names), – yet they hold PROXIES for an estimated 200+ units and will end up placing at least one or possibly two people of their liking on the Board.  What is wrong with this picture?  Not only that, but they place their EMPLOYEE, Dass Ramadass, on the Ilikai Board, who does not own anything here.

Dass Ramadass may be a wonderful person.  BUT: He is NOT an Ilikai owner.  He is an EMPLOYEE of companies owned by a family, who happen to own one single unit at the Ilikai (or several at most).  How can Dass Ramadass act on the basis of undivided loyalty and FIDUCIARY DUTY to the Ilikai AOAO when he does not own anything and instead is an employee of a company with who knows what commercial interest here?  Wouldn’t he simply do what his EMPLOYER tells him to do?

I am NOT questioning Ramadass’s integrity in any way whatsoever.  There is nothing illegal with this setup, nothing in violation of the Bylaws and condominium law.  But come on, it is a no-brainer setup for potential conflicts of interests.  Do we need/want this here?  Haven’t we had enough of these conflicts of interests, hidden agendas, behind the scenes commercial interests?

But wait.  There is more to it.  What about the other Directors who are also running for re-election?  Upon information and belief, several of them rent through Marina Vacations (i.e., one of the Tokioka’s companies).  This includes, upon information and belief, Board Director Bob Romo who rents through them, Board Director Bob Currie, and Board Director Bill Lawrence.  Their rental income depends on Marina Vacations making sure their units are rented out.  I am NOT questioning their integrity in any way.  I am simply pointing out the facts.

Suppose, hypothetically speaking the Board decides to replace Hawaii First with Hawaiian Properties (a Tokioka’s company).  Dass Ramadass will excuse himself since he has a clear conflict of interest.  But what about the other Directors who happen to depend on Marina Vacations for handling their rentals?  That is just one example!

Am I the only one who has problems with this?

But wait.  There is more.  John Popovich has spent many years working for various companies of the Tokioka Family.  The current Board hired John Popovich as the AOAO manager.

By the way, remember the saga with renters from a neighbor building, Ilikai Marina, coming over to use our POOL?  Remember that?  Remember the explanation that John Popovich gave claiming that those renters are “guests of the unit # 1623″?  (P.S.: There have been so many complaints from Ilikai owners about this.  The AOAO may have addressed the problem by now.  I do not know either way re the current status.)

What is my point and what is my proposed solution?  My point and proposed solution are:

(a) There is way too much potential for conflicts of interest in our Ilikai.  We have already had so many problems because of that.  It is enough.  Not only that, but also this “invisible hand” of the Tokioka Family here is something what can play out in who knows which ways that could affect all of us, Ilikai owners, in who knows which way.  They own one unit, and because of that and by virtue of running a commercial enterprise here, they end up with proxies for at least 200 units?!

(b) I will pitch for myself as a Board candidate here: I have NO conflicts of interest here.  I have no affiliation with any of the commercial entities here.  Click here to read more on my vision as a Board Director candidate.  Vote for me!

(c) As for those estimated 200+ proxies that Marina Vacations holds: I think they should show good will and give up those proxies.  The Tokioka Family owns only ONE unit (or several at most)!  The 200+ proxies come NOT through ownership but through their business operation!  Dass Ramadass is not an Ilikai owner.  He is simply an employee of the Tokioka Family.  Would he act in a fiduciary manner to the AOAO or would he pitch the commercial interests of his employer, the Tokioka Family?

P.S.: By the way, here is what Dass Ramadass wrote in a March 12, 2008 publication in Midweek (click on the link).  Here is in Dass Ramadass’s own words, “I started my career at Hawaiian Properties as an intern. I’d come to Hawaii from my home-town, Kuala Lumpur, in Malaysia. I thought I’d spend the summer studying at Hawaii Pacific University before going to London to study law. Before I knew it, the summer had turned into semesters and the semesters into years.  Today, 21 years later, I’m still at Hawaiian Properties.”

In my posting on January 24, 2010 on “My vision as a Board Director candidate for the Ilikai and the Board” (see below), one of the key items pertained to my dream vision for the Yacht Harbor Tower (YHT).  I wrote that my dream vision is that our Ilikai will unite back with the Yacht Harbor Tower. This will solve many problems for the Yacht Harbor Tower and its current owner (eRealty) and us.  I believe it will be good for all parties involved.  I also wrote that imagine how great it would be if iStar managed to work out some deal with eRealty to merge back the YHT and Ilikai hotels.  Let’s encourage that!

Here is some elaboration on this thought.  As you have all heard by now, the Edition Hotel is set to open at the YHT.  The Edition Hotel is the Marriott’s new, top of the line, luxury boutique hotel brand.  The Edition Waikiki is supposed to be the first ever Edition Hotel in the world.  This is certainly a very exciting prospect, really something to look forward to.  My dream then is that maybe our Ilikai Hotel can merge with the YHT hotel, so that we are again together, as one complex, the way the Ilikai has been for decades.  Admittedly, it is not realistic for the super luxury Edition brand to be at our Ilikai as well.  Let’s face it, our Ilikai needs a serious facelift.  Our Ilikai has a huge potential, it just looks rather dated at this time and needs a facelift.  But here is what Marriott could do: they could run the YHT as their Edition Hotel and then the Ilikai as some other of the Marriott’s brands.  For example, if you have been to Las Vegas, then you are probably familiar with the MGM Grand.  What many do not fully realize is that there are several hotel brands in the same MGM Grand complex.  Specifically, the MGM Grand includes the main MGM Grand (Grand Tower, West Wing etc, with the check-in etc in the main tower), the Signatures (three condotel towers connected to the main MGM Grand complex with a long covered walkway), and the Skylofts Penthouse Lofts (their five-star property, located on the upper floors of the main tower).  These hotel components are part of the same MGM Grand complex, but differ significantly from each other and cater to different types of guests.  This is very common.  Many hotels have this type of setup these days.  So in theory, what Marriott could do is to operate the YHT as their Edition hotel (luxury boutique) and then operate the Ilikai hotel as another one of the Marriott’s brands, such as the Renaissance, as we used to have at our Ilikai.  I.e., something upscale but more conservative, especially considering the demographics of the Ilikai owners, many of whom are older. (Remember the Marriott Renaissance days?  I bought my condo during that time.  I came to the Ilikai, and it swept me off my feet, with its beautiful courtyard, happy hotel atmosphere etc – and NO timeshare at that time.)  I know the above vision is far fetched, but that’s my dream, I am brainstorming.

Also, again, keep in mind that luckily, Shell’s timeshare at the Ilikai is NOT ”deeded.”  Some timeshare is deeded, i.e., 50 or whatever number of timeshare owners hold the deed.  But in the Shell’s case at the Ilikai, it is Shell and NOT the timeshare owners who actually own those 123 units.  What this means in practical terms is that it would be relatively easy for Shell to sell their 123 units and get out of here.  Also keep in mind that all of Shell’s units are uniformly remodeled and decorated.  Therefore, should iStar buy those units from Shell, they can easily add them to the other 203 hotel rooms that they own.  Let’s encourage this to happen!

The Ilikai AOAO Board of Directors consists of nine Directors. Of those, seven will be up for election at the upcoming Annual Meeting on March 2, 2010.  I put forward my candidacy for the Board.  In the coming days, I will be posting to elaborate on my vision for the Ilikai and the Board, and also why I think I make an excellent candidate for the Board.  Below is the overview/summary.  (As said, I will post to elaborate on all these areas, not necessarily in the order listed).  If you have comments, questions, suggestions, feedback, complaints , please share those, incl. via e-mail (olga@ilikaiowners.com).  I would be happy to meet as well and talk on the phone (please e-mail to coordinate the time, date etc).  (Not as any excuse, but please kindly keep in mind that I work, incl. sometimes working long hours, travel to the Neighbor Islands etc.  So sometimes things take longer for this reason.)

I also humbly ask for your vote proxy.  Click here for instructions for this.

So here is the OVERVIEW for my vision as a Board Director candidate for the Ilikai and the Board:

1) Foundation: The Code of Conduct and related considerations

I will post on the Code of Conduct, as I believe this is truly the foundation for the Board of Directors, AOAO manager, legal counsel, contractors, and all of us if we want to move forward, incl.:

(a) Ethical conduct as Board Directors

(b) Reducing and eventually eliminating conflicts of interest that plague the way the Ilikai AOAO is managed, incl. in the Board of Directors. (It is an ongoing issue at the Ilikai, and what is particularly troubling is the lack of awareness, recognition, and will to address this ongoing problem – I will post more specifics.)

(c) Developing and establishing policies and procedures for contracts procured by the Ilikai AOAO, incl. proper bidding based on clearly delineated scope of work, contractor qualifications, wide solicitation, and establishing processes to prevent favoritism and any potential for contractor kickbacks.  This needs serious streamlining at the Ilikai AOAO.

(d) Moving the Ilikai AOAO in the direction of being managed professionally and by professionals (a major issue at the Ilikai), incl. clearly defining and streamlining the role and functions of the Board of Directors, Board President, committees, AOAO manager, AOAO legal counsel, AOAO financial managing agent, and contractors

(e) I and many other owners are of opinion that the current Board runs the AOAO as an Old Boys Club (”OBC”).  Let’s work towards changing this OBC culture!

2) Defining and articulating to ourselves – and to the world – what we want and what we do not want, in terms of key parameters, such as who is welcome here (e.g., a full service hotel is most welcome here) and who is not welcome here (e.g., timeshare is NOT welcome here)

3) Dealing with Shell and timeshare at the Ilikai:

(a) The Ilikai governing documents (Declaration and By-Laws) delineate permitted uses of units.  Both the Ilikai Declaration and By-Laws state, “The owner of each apartment within the building shall use such apartment only as living accommodations for hotel or apartment purposes” (emphasis added).  I.e., timeshare is NOT listed as one of the permitted uses of units.

(b) Why is timeshare bad for the Ilikai, Ilikai’s reputation, and our property values?

(c) Why is it important to work towards removing timeshare off the Ilikai premises?

(d) Steps to consider for a more effective approach

4) Preserving the Ilikai Hotel:

(a) The huge value of a successful Ilikai Hotel for individual condo owners, incl. for our property values and for rental income for those owners who rent

(b) Collaborate with iStar (the current owner of the Ilikai Hotel) in a fair, collaborative, and professional manner

(c) The Board should play an active and proactive role in preserving the full service hotel component at the Ilikai.  (E.g., when Shell and timeshare got to the Ilikai in 2005, where were the owners-controlled Board (some of whom are on the current Board and are candidates for the upcoming elections) and the Ilikai AOAO legal counsel, Motooka? – I will post more information on this.  Let’s learn from mistakes.)

5) Ilikai renovations:

(a) My vision is that whatever renovations we do in the upcoming year and beyond should be used as a terrific opportunity to bring the Ilikai out of its current notably dated state into a more upscale destination. This to include hallway carpet renovations, lobby, pool, and elevators.

(b) These renovations should enhance our quality of life here, our property values, and rental income for those owners who rent.

(c) Renovation related decisions should be made with full engagement of professionals, such as designers and architects, and not by volunteer amateurs (I will post more on the current process of decision making by the Board – it is horrifying). 

(d) Also, importantly, there should be a process for owners to provide input and feedback.

6) Proactively dealing with the delinquencies (now over $1.4M) – this is just way too much money to simply write off as the current Board appears to want to do for most of that sum, –  incl.:

(a) The role Lyle Hosoda, Hawaii First and Richard Emery, and Chris Goodwin potentially played in the circa $1.2M Anekona delinquencies fiasco

(b) From whom can we potentially collect those circa $1.2M delinquencies?

(c) An urgent need to step up efforts to collect delinquencies of individual condo owners

7) Addressing other real or potential assaults and threats to the Ilikai and our property values, such as:

(a) The Hilton Luau noise

(b) Future development of the Ala Wai Harbor area in front of the Ilikai

8 )  An urgent need for competitive bidding for the Ilikai AOAO master policy insurance

9)  Re the Yacht Harbor Tower (YHT):

My dream is that our Ilikai will unite back with the Yacht Harbor Tower. This will solve many problems for the Yacht Harbor Tower and its current owner (eRealty) and us.  I believe it will be good for all parties involved. Just imagine how great it would be if iStar manages to work out some deal with eRealty to merge back the Yacht Harbor Tower and Ilikai hotels.  I hope we can encourage iStar and eRealty to start a dialogue, who knows maybe they can work out some mutually beneficial deal.  Maybe the Edition Hotel set to open at the YHT can even be expanded to include the Ilikai. I know it is far fetched. But this is my dream.  Another dream that I have is to have Shell sell their 123 units currently in the timeshare program to iStar.  (Keep in mind that luckily, Shell’s timeshare is NOT ”deeded,” i.e., it is Shell and NOT the timeshare owners who actually owns those 123 units.  Let’s hope Shell comes to their senses, sells their 123 to iStar, and gets out of here.)  This way our Ilikai Hotel will be bigger.  If our hotel can then merge with the Edition Hotel set to open at the YHT (via a mutually beneficial deal between iStar and eRealty) then this will be like the ultimate dream come true.  I know it is far fetched.  But even simply writing about it lifts my spirits and puts a smile on my face.  Let’s try to encourage iStar and eRealty to work together.

10) Fostering ongoing communication between the Board and owners, incl.:

(a) The Board and AOAO manager should commit to responding to Ilikai owners, incl. their letters, concerns, questions, feedback, and suggestions

(b) If elected (or not elected), I plan to continue maintaining this blog site (www.ilikaiowners.com).

11) What makes me (i.e., Olga Geling) a good candidate for the Board?

(a) The pros (will elaborate later)

(b) The cons (will elaborate later)

(c) There are for sure negatives about me, some of which I am actively working to overcome.  This includes that I sometimes say things not in the most diplomatic way.  I am well aware of this and am sincerely working on it (but keep in mind: it is election time! The gloves are off!).  I believe the pros outweigh the cons.

12) Why the Old Boys (and some ladies) Club (OBC) candidates are a terrible choice for the Ilikai Board? (The OBC candidates are: Lea Sasak, Bill Moore, Bill Lawrence, Bob Currie, Dass Ramadass, Lavonne West.), incl.:

(a) The dismal track record of the OBC candidates as the current Directors on the Board (from March 2009 through now)

(b) The dismal track record of the OBC candidates in the past, incl. who allowed Shell and timeshare to infest the Ilikai?

(c) Additional “enlightening” trivia, incl. who brought Lyle Hosoda to the Ilikai? (The Hosoda saga and the way the current Board consisting of the OBC Directors tackled the delinquencies over $1.4M speak volumes about certain OBC candidates.)

13) The “elephant in the room” – the Tokioka Family:

This is a serious concern for many reasons.  Related to that are the concerns associated with having Dass Ramadass as a Board Director. 

I will post in the coming days more on all of the above listed areas. I know it is a very ambitious list as a vision statement. In no way am I suggesting that I can accomplish all of the above. It requires joint effort.  But the list gives the idea where I stand as a candidate for the Board. If elected, I will do my very-very best to work on these priorities.

ANY FEEDBACK IS MOST WELCOME AND ENCOURAGED!

The next Board of Directors meeting of the Ilikai AOAO is scheduled for Thursday, January 28, 2010, at 3 PM in Kauai Room on the 2nd floor.  Ilikai owners are encouraged to attend.

As you know, the Ilikai Hotel – i.e., its current owner, iStar – has ZERO representation on the current Board.  Not even one Director (of the nine Directors total).  Is it fair?  This is despite the fact that the Hotel/iStar’s stake at the Ilikai amounts to 28%.  Not only that, but our Hotel is so important to all of us, since so many of us chose the Ilikai precisely because of the presence of the Hotel with its hotel atmosphere.  For those owners who rent their units, the presence of the Hotel and its hotel atmosphere is believed to contribute positively to the rental income.

iStar did try to get one person, Leslie Love (who is iStar’s Senior Vice President), elected to the Board.  In the fall (of 2009), there were vacancies in our Board of Directors.  To fill those vacancies, the remaining Board Directors were the ones to vote.  Leslie Love attended the meeting, talked about iStar, presented her case. The Board voted Leslie Love down.  Instead, they chose Lavonne West and Bill Lawrence to fill those Director vacancies.  Is it fair?  It was like a massive slap in the face of iStar and our Hotel.  What were they thinking?  Parenthetically, Lavonne West then left on a cruise for over two months and wasn’t even here to contribute.  The current Board Directors would claim that they did so so that they have “votes” for key Board decisions.  But what have they accomplished or even try to accomplish since then? - Nothing.

What is my point?  My point is that the current Board failed to be supportive of the Hotel and failed to show good will towards our Hotel and iStar.  In fact, their refusal to allow even one iStar representative on the Board (despite iStar’s 28% stake at the Ilikai) most likely had a negative effect on the relationship between the AOAO and iStar.  It is not fair to treat people like that.