UH and ASUH ownership of the Honolulu Stadium

At one time the University of Hawaiʻi (UH) and the Associated Students of the University of Hawaiʻi (ASUH) were the major shareholders of the Honolulu Stadium located on King and Isenberg Streets.  From 1926 to 1976 the “Termite Palace[1]” hosted thousands of high school and UH football games, was the home of the Triple-A Pacific Coast Leagues’ Hawaii Islanders, and hosted notables such as Elvis, Babe Ruth, Irving Berlin, and Billy Graham, at times exceeding its 26, 000 seat capacity.

Early 20th Century UH cheerleaders lined up on the field of the Honolulu Stadium.

Local businessman J. Ashman Beaven raised money from Honolulu’s prominent citizens and constructed the Stadium on a 14 acre parcel that he had purchased from the Kaauila Land Trust for $100,000.  Honolulu Stadium, Limited was incorporated on September 9, 1926 with future UH President David L. Crawford as VP and Director of the enterprise. President Crawford aggressively encouraged shareholders to donate their stock to the University.

In 1931 the ASUH negotiated a sublease to manage the Stadium during football seasons for a $10,000 annual rental fee. By 1936 most of the shareholders had donated their interests to UH and over the next three years smaller shares were purchased making UH and ASUH owners of almost two thirds of shares.

As early as 1947 the Board of Regents (BOR) contemplated disposing of UH shares. BOR minutes of October 21, 1947 state:

The Board agreed that the University should have a business agent sell its stock in the Honolulu Stadium Limited,…The Executive Officer was asked to inform the officers of the ASUH of the plans for the sale of our Stadium stock and to attempt to obtain their permission for the University to handle the sale of the Stadium stock of the ASUH.

In 1955 the Board of Regents announced the University would sell its equity in the Stadium resulting with a bid of $24 a share, for a total of some $270,000 ($2,574,550 in 2019). In an Executive Session of the BOR, July 19, 1956, this intent was reiterated in a letter to the City & County of Honolulu noting “…the land alone (approximately 9.365 acres) is conservatively valued at $500,000.  By 1958 the University and ASUH owned 70% of shares.

Players and umpires at a Honolulu Stadium game, with crowd in stands in the background.

The Stockholders Protective Committee, chaired by UH President Sinclair and comprised of major and minor shareholders represented 92% of shares.  Among those stockholders was counted financier extraordinaire Chinn Ho, referred to as the “Chinese Rockefeller of Hawaiʻi,” who owned 10% of Stadium shares and was instrumental in bringing the Pacific Island League to the islands

In 1960 the Hawaiʻi Attorney General provided this opinion of the legal relationship between UH and ASUH:

…ASUH is an independent unincorporated association created under the authority granted by the Regents….Therefor, the proposal for the disposal of the stadium stock held by the ASUH should be decided on by the ASUH Senate, as provided for under Article IV, section B of the ASUH Constitution.

The formation of a Honolulu Stadium Board of Directors—consisting of ten members, including alumni, the ASUH President and two BOR members—articulated the University’s holdings of 9,128 shares and ASUH’s holdings of 1,481 shares. Chinn Ho also served on this board, and in 1960 informed the BOR Chairman that the Stadium Board of Directors had rejected a conditional purchase proposal by the City & County of Honolulu on November 18, but that a proposal by the minority stockholders, of which he one, had been favorably received. With the time-sensitive goal of transferring the Pacific Coast League’s Sacramento franchise to Honolulu, Ho proposed a Committee of Arbitration of three be authorized to represent the major UH stockholders with himself and Ralph Matsumura representing minority stockholders.  Unable to raise the estimated $500,000 to $800,000 to renovate the Stadium to accommodate the Pacific Coast League’s team, the new owner of the Honolulu franchise—Salt Lake City business man Nick Morgan Jr.—agreed to pay annual rent of $11,000 to the Honolulu Stadium Corporation for five years, with UH remaining the majority stockholder and committing to investing $50,000 to construct box seats and to improve the lighting and dugout facilities. However, full-scale renovation never took place.

A 1963 analysis of the stadium’s  affairs for the previous five years by Comptroller Tanabe reported, “…Today it (Honolulu Stadium, Limited) owns 398,912 square feet (9.158 acres) of land which was appraised in 1960 to be worth $1,200,000 as is.”  The net income for the previous five years averaged $23,000, with the University receiving dividends from 1943 to 1962 that totaled $95,680.45, distributed between athletic scholarships (43.2%) and general university scholarships (56.8%).  The major stockholders at this time were:

Major Stockholders                                        Shares                  Percent

University of Hawaii                                        9,128                     61.38%

ASUH                                                                    1,481                     9.96%

Alice Wakaki[2]                                                     1,652                     11.11%

Capital Investment Co.                                  1,500                     10.09%

Others (71 individuals owning one to a maximum of 147 shares each)                                         1,110                     7.46%

Treasury Stock                                                     129

 

A civil court Complaint for Declaratory Relief on behalf of ASUH against UH was filed in 1974 seeking confirmation of their right and legal capacity to hold stock in the Honolulu Stadium, Ltd. and right and legal capacity to hold land in its own name providing them the right to enter into a joint venture agreement with UH in the event of liquidation of shares[3].

In 1976 the stockholders of Honolulu Stadium, Ltd. agreed to sell their holdings to the State, which had offered them—under threat of condemnation—$8.5 million, slightly less than the appraised value. The directors reasoned that negotiating a higher price would involve continued costly operation of the facility, without the benefits of quick reinvestment of proceeds. Director Chinn Ho wrote to, “I would prefer to put my faith in the market rather than in the termites.”  Now worth $571 per share, the University and ASUH together realized nearly $6 million following liquidation.

[1] A University entomologist used the facility for termite studies.

[2] Veteran ticket taker reported to be holding her shares for ‘sentimental reasons.’

[3] Pers. Comm, Ian Mattoch, May 14, 2019

 

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