Larry Ellison: Aloha and Mahalo

Dr. David Argus, cancer specialist, discusses Lanai
health initiatives with Larry Ellison (Star Advertiser)

Go east, young man (or go west, old man); the destination doesn't seem to matter to skilled youngsters or wealthy oldsters as long as they're moving out from California.

Yesterday we noted how Oracle is moving its Redwood Shores headquarters--a two-mile walk from our house using the Bay Trail--to Texas. Meanwhile, its billionaire founder, Larry Ellison, has departed for Lanai, the island he bought eight years ago.

“Following Friday’s announcement ... I’ve received a number of inquiries about whether or not I will be moving to Texas,” Ellison wrote. “The answer is no. I’ve moved to the state of Hawaii and I’ll be using the power of Zoom to work from the island of Lanai,” he added, signing off the email with a “Mahalo.”

Hawaii also attracts Mainlanders who don't have the wherewithal to buy their own island. Bay Area residents who are able to work remotely are leaving for Hawaii: [bold added]

[35 y.o. founder of kWh Analytics Richard] Matsui is part of a wave of Bay Area residents landing on the Aloha State’s shores to take advantage of new pandemic-related remote work policies. While some are relocating permanently, others have made the trans-Pacific hop for three- to six-month sojourns where they rise before dawn, wrap up work by midafternoon and hit the beach or hiking trail by 4 p.m. Matsui is now participating in a collaborative effort among the state, nonprofit organizations and businesses that incentivizes remote workers to set up shop in the archipelago.

Hawaii’s appeal for Bay Area transplants with the financial means to move and jobs that allow it goes far beyond sun and surf. Of all 50 states, it has the lowest death rate due to the coronavirus and the third-lowest infection rate. While many popular international destinations are closed to U.S. travelers, Hawaii’s tropical climate and unique culture remains accessible. Additionally, the pandemic crippled Hawaii’s tourism industry, the state’s No. 1 private employer, leaving many accommodations typically booked out months in advance open for longer stays.

“We’ve noticed a significant increase in applicants for long-term rentals that are intending to work remotely,” said Andreea Grigore, senior vice president of property management at Elite Pacific and co-founder of the Hawaii Legal Short-Term Rental Alliance. “While a majority of our long-term rentals continue to support local Hawaii families, there is a growing percentage of our higher-end rentals that are being leased by families from the Bay Area.”

After watching Mainland transplants over a lifetime, my general observation is that they don't stick around unless they have family and friends already in Hawaii. If they arrive as a couple, one or both eventually get Island fever and leave.

It's also tough if they don't have a job lined up. The devastation wrought upon Hawaii's tourist industry has produced an unemployment rate of 15%, double that of California.

IMHO, the California-to-Hawaii migration isn't and won't be a widespread phenomenon.

Feet on the Ground

(Image from Business Insider)

As his company moves into the cloud, billionaire Oracle founder Larry Ellison has accelerated his investments on the ground.

In 2012 he bought 98% of the island of Lanai. Not being content with owning the two Four Seasons hotels that came with the $300 million purchase, Mr. Ellison bought the 10-room Hotel Lanai in 2014 and now owns every hotel room on the island.

In 2015 he paid $71.6 million for Palo Alto's 86-room Epiphany Hotel.

Earlier this month "Oracle Corp. has purchased the 476-room Marriott Hotel in San Mateo for $132 million, in part to use for training its direct-sales staff."

These property purchases may seem staggeringly large, but they constitute only one percent (1%) of Larry Ellison's estimated $50 billion fortune.

Let me tell you about the very rich. They are different from you and me.
                                                                               --F. Scott Fitzgerald

Larry's World

Oracle Team USA's comeback from an 8-1 deficit to capture the America's Cup was another feather in the cap for Larry Ellison, the richest and oldest member of the Bay Area billionaires' club. Over the past 35 years Oracle Corporation, which Ellison founded, has brushed aside and absorbed former high-fliers like Siebel Systems, PeopleSoft, and Sun Microsystems.

Last year he acquired most of the Island of Lanai and is transforming it into a laboratory for eco-friendly ways to live.

Oracle Team USA's come-from-behind victory was historic not only in the history of yachting but of all sports. For Larry Ellison it's just another chapter in a unique bio that includes both curfew violations for flying his Gulfstream over San Jose residences and a promise to donate most of his estate to charity. At the still-vigorous age of 69, Larry Ellison doesn't appear to be done yet. © 2013 Stephen Yuen

We Believe What Billionaires Say

Hulopoe Beach, Lanai (McClatchy photo)

Three months after his purchase of Lanai from Castle & Cooke / Dole Food was revealed, Oracle billionaire Larry Ellison discloses a few of his plans:

Based on his remarks in a CNBC interview at Oracle OpenWorld, Ellison sees the 141-square-mile island as a “laboratory for experimenting with more environmentally sound ways of living,” per AP, and “hopes to convert sea water into fresh water” — a currently limited commodity. “He also wants more electric cars on the island” — where most roads require four-wheel-drive, visitors rent pricey Jeeps and locals tend to prefer big pickups — and “hopes to increase its fruit exports to Japan and other markets.”

If he wanted to do research on electric cars and desalination, Larry Ellison could have done it in the Bay Area (near Oracle headquarters) without spending a half a billion dollars for a Hawaiian island.

Building a large-scale environmental laboratory may be part of the plans for Lanai, but there has to be more to it than that. And he'll be able to do fruit exports better than Dole? Please.

I Said I Wanted to Buy a Lanai For My House

Bloomberg photo via WSJ.

Maybe his lawyer didn't hear the end of the instruction.

This week it became public that Oracle co-founder Larry Ellison will buy 98% of the Island of Lanai from Castle & Cooke. (This is another example of life imitating art: one of the purported bidders for the 25,000 undeveloped acres on Kauai in The Descendants was a Silicon Valley billionaire.)

At this point no one is revealing what Mr. Ellison intends to do with his purchase. He has a history of buying and kickstarting underperforming companies (Peoplesoft, Sun, Siebel) into valuable assets of the Oracle group.

3,500 people on a sleepy island shouldn't provide an obstacle to Mr. Ellison's ambitions...whatever they are.