The Maui community of Lahaina in the aftermath of devastating wildfires.
State Farm/Creative Commons

'Reason for optimism' as Maui’s road to recovery takes shape 

Rebuilding after the Lahaina wildfires will be challenging and costly, but not "ominous."

August 25, 2023
3 minutes

Key points:

  • Damages from the wildfires, which destroyed around 2,220 structures, may run between $2-4 billion.
  • Compared to Hawaii's last disaster of this magnitude, a hurricane which struck Kauai in 1992, the recovery may happen faster.
  • "We have a very good sense of the height of the hill we need to climb," said CoreLogic's VP of hazard and risk management.

A new estimate puts the property damage caused by the wildfires in Lahaina at between $2 billion and $4 billion, and it may take as long as a decade to rebuild.

But a team from the data analytics company CoreLogic is hopeful that the oceanfront town, once teeming with tourists and known for its strong sense of community, will come back — perhaps even sooner than expected.

"There is a reason for optimism," said Tom Larsen, CoreLogic's associate vice president of hazard and risk management, during a webinar on Aug. 24. "There is no certainty, but there is cause for optimism that we will have a faster recovery."

There are 70,000 residential and commercial structures on Maui — 3,000 of them in Lahaina. Of those 3,000 structures, 2,200 were damaged or lost in the fires, said Ed Martinez, CoreLogic's director of industry solutions. The damage estimate includes the impact on the tourism industry, specifically the businesses on Front Street destroyed by the fires.

Corelogic could not provide a percentage breakdown of commercial versus residential property loss and damage, "but the bulk of it will be residential housing," said Larsen.

And while the Lahaina fires caused the worst devastation Hawaii has seen since 1992's  Hurricane Iniki — which struck the island of Kauai with 145-mph winds, and caused $3.1 billion in damage — CoreLogic leaders believe the recovery timeline will be less than the 10 years it took Kauai to come back.

That's due in part to logistics: The Kahului Airport — which serves Lahaina — was not damaged in the fires, so supplies and labor will be able to be transported to the area. That wasn't the case with Kauai's Lihue Airport, which suffered heavy damage in Hurricane Iniki, hampering rebuilding efforts.

"We don't expect this to be ominous, despite Lahaina being fairly remote," Larsen said. "We should be able to restore much faster."

And yet, there are some "barriers unique to this event," said Brandon Burton, CoreLogic's senior principal of industry relations.

The geographical setting will present some limitations — but so will the level of expertise needed to do this degree of recovery work, Burton said.

"People have a skill set that is a specialty inside a specialty," Burton said. "It is an emerging area within the area of restoration. Taking that expertise and resources to the island is going to pose some challenges."

And then there are labor costs, which are typically 40% higher on Maui than on the mainland, said Jay Thiese, CoreLogic's associate vice president.

Solving a myriad of insurance issues will also be tricky, said Thiese. In Hawaii, he said, "a decent amount" of structures are unpermitted and uninsured.

Actual building will probably not start for six months, Thiese said, which will allow materials to be stocked and staged in the area.

"Supply and demand pressure will dictate how long the reconstruction will take," he said, adding, "There are a couple of complications here that will need to be sorted out."

That said, CoreLogic is optimistic about Lahaina's recovery.

"It's 12 days post-event, and we have a very good sense of the height of the hill we need to climb," Larsen said, adding that improvements in technology will greatly help the assessment and recovery process.

Said Martinez: "The challenges are with permitting, reconstruction costs and the availability of resources. They will recover. But it will take time."

Want to help? The Realtors Association of Maui Foundation is working to support the island community in the areas of housing and education, as more than half of students need some kind of assistance to meet basic needs.

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