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Larry Ellison's Island of Lanai
He grew up in the south side of Chicago in a working class family. He was nothing special then and dropped out of college and lacking direction, he drifted from one job to another in his 20's. Now, 68, he grins when he thinks about his humble and nothing special youth and young adult years. He grins also because he is worth $40 billion!
The island of Lanai has 3,100 people living there. The island is well known for its tourist destinations and back in 1922, Mr. Dole, of Dole Pineapple, bought the island for only $1 million and turned into a pineapple producing island. In 1986, David Murdock bought the island because Dole pineapples were being grown elsewhere and cheaper. He wanted to make Lanai a tourist destination. During his tenure, Murdock's dream had issues because getting to Lanai was a 40 minute ferry ride from Maui or using the more unreliable air service. After he spent $700 million in island improvements, he had had enough and tried to sell it for $1.2 billion. Larry became interested in the island in 2012 when it was neglected and locals were angry about Murdock's plans. Larry bought the island for less.
Larry's plan for island is a combination of agriculture (growing mangoes and pineapple on large scale), vineyards and flowers to extract perfume. He wants to use use solar power to convert seawater into fresh water for irrigation purposes. For those working on these plantations, refurbished homes (out of the 1500 homes on the island, he owns 400 of them). In order to attract airlines, he plans to lengthen the runways and two have shown interest in flying there.
Larry has already done several infrastructure improvements to the main roads, city buildings, schools, parks. What Larry plans to do is to attract another 3000 residents for a total of 6000, all in hopes of improving the local economy. That will be no easy deal- a gallon of milk is $10 and a gallon of gas is $5.60. The locals are skeptical because they have been down this road a few times with other owners in the past and all failed. Larry is trying to make Lanai a tourist destination that is not like what Maui has become- congested, a small version of San Diego.
He has big dreams. He is planning a desalination plant that will produce 10 million gallons of fresh water daily, this is currently at 4 million. He is creating charging stations for electric cars. He wants to built a third hotel on it with 100 rooms at Halepalaoa and run some of it from solar energy. Currently, there is the Four Seasons at Manele bay that has gone extensive renovation.
Still, all these things may not change the economics of the island. Everything is shipped in. The only real industry is tourism and if Ellison does not even want a Maui-like destination, how will it sustain itself?
Larry got a great deal for the island- only $300 million!