Midwest Minute - February 06, 2012

Water – Fresh or Salty?

As we go about life here in the Midwest enjoying a relatively mild winter, local farmers and ranchers are starting to worry about the scant snow cover and the lack of ground moisture that may greet them this spring.  Is this the beginning of another drought cycle like we experienced ten years ago, or will there be timely rains during the growing season?

We have just come back from a ten day vacation in Maui, and you may be surprised to learn that drought is also an issue there compounded by growing tension between the agricultural and tourism industries.  Now Maui is an island in the Hawaiian archipelago and for as long as anyone can remember, it has always had sufficient fresh water to meet its needs.  Just like our west coast, the moisture laden clouds come off the ocean, almost on a daily basis, and shed rain as they rise against the peaks of dormant volcanoes.

Early in the twentieth century, enterprising sugar cane farmers developed a network of ditches to trap the water and bring it down onto the plains to irrigate their crops.  This consistent supply was also shared with the neighbouring towns that housed the workers, and of course, to the processing mills.  It surprised me to learn that even today it takes well over 100,000 gallons of fresh water to produce a pound of sugar.  Granted, some of the effluent is re-cycled with crop residue into livestock feed, however most of it is simply returned to the ocean.

Although Maui has long been a stop for outsiders seeking rest and recreation, starting the with the rowdy whaling crews of the 1800s’, it wasn’t until about forty years ago that there was significant residential development along the coastal areas encouraging tourists from countries all over the Pacific Rim to visit (and invest).  From my perspective, there wasn’t a lot of thought given in the early years to how a community should be planned out, probably because no one anticipated the level of infrastructure that would eventually be required to meet the demand.

One thing I credit the native Hawaiians with is their unceasing determination to make all beach areas publicly accessible.  Even the largest five star hotels have to provide free parking close by and maintain walkways, even restrooms and exterior showers, for anyone to use.  This is certainly not the case in other locations, like the Gulf coast of Florida or much of southern California, where the private interests of the wealthy tend to trump enjoyment of the natural landscape by the average citizen.

The Hawaiian Islands have not been immune to the recession felt by the United States mainland. Their real estate board just produced a chart showing that after four years of slumping prices from the peak in 2007, that demand is now equaling supply.  Location, like in any second home or recreation market, is key with an ocean view one bedroom / one bath condo in a thirty year old complex going for anywhere from $275,000 to $400,000; a downward adjustment between thirty to forty percent.

Last summer, farmers were told not to harvest over 25,000 acres of standing sugar cane because the fresh water required for processing was to be diverted to servicing the domestic population.  I wonder what it must feel like to drive by beautiful grass green golf courses and impeccably landscaped gated communities, while watching your crop burn in the fields so you can plow them under? 

Vern McClelland is an associate broker with RE/MAX of Lloydminster and a partner with The Midwest Group.  If you have questions or comments on this article or other real estate matters, he can be reached at 780.808.2700, or through the website www.wesellmidwest.ca

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