The Lahaina, HI (and Kula) fires on August 8, 2023, have left a deep scar on the hearts of those who hold the place dear. As someone who isn’t native Hawaiian, I feel a sense of hesitation in discussing real estate or the physical rebuilding of Lahaina, knowing that far more was lost than the over 2,200 homes and businesses. It feels like I may not be the right person to speak on behalf of a place so rich in Hawaiian history—a place that was once Hawaii’s capital, a place where Moku’ula was located, and a place that was once well irrigated, farmed and inhabited by Hawaiian Royalty.

In total, 102 lives were lost, over 5,000 people were displaced, and blocks of neighborhoods and businesses were reduced to ashes from a fire so hot, it broke down the chemical components of environmental contaminants that many feared after the fire. Now, the community faces the daunting task of preserving history, imagining a future, and rebuilding both physically and emotionally.

Despite the heartbreak, it’s important to acknowledge the efforts of those leading the recovery. Mayor Richard Bissen, FEMA, and countless local and federal agencies and non-profits have been working tirelessly under immense pressure. Hero businesses such as Hawaii Foodservice Alliance drove their trucks literally through the ashes to deliver food and water to shocked survivors. The cleanup of burned homes and businesses has progressed at a remarkable pace, giving residents a chance to start assessing what remains. This swift work provides hope that, although the journey ahead is long, recovery is possible, and the spirit of resilience and Aloha is strong in Hawaii.

However, rebuilding Lahaina will be a complex, lengthy process. Even before the fires, Hawaii’s remote location, limited labor force, and high shipping costs made construction costs expensive and challenging. Now, with so much to rebuild, these issues are magnified. While building costs have dropped in some parts of the country, in Hawaii, they remain elevated—though they’ve increased less in recent years, they’re still up more than 50% over the past five years.

Complicated by our geography, supply chain disruptions and competition in other markets, it’s not unusual for builders to wait 12 months for a transformer. In addition, The Jones Act means anything bound for Hawaii from a US Port must be on a ship built in the US and owned by US citizens, costing Hawaii 1.2b annually.

Labor shortages add another challenge. Hawaii’s construction industry is stretched thin, aging, and busy with State and Federal infrastructure and military projects. All islands except for Hawaii Island have lost residents over the past several years, with Maui suffering the most. Bringing construction workers from the US mainland is not a straightforward solution, given the limited and expensive housing available. Labor is also very expensive in Hawaii, having the highest rate of union membership in the US, just above New York. As I write this, one of our Nurse Unions is on Strike, as is one of our Hospitality Unions.

Many landowners were underinsured, with rising construction costs outpacing their coverage. During a time when replacement cost and general insurance costs were rising at incredible paces, it was mostly impossible for owners to “keep up” with replacement cost coverage. Each owner will face unique challenges, depending on their financial situations, insurance and settlement receipts, and personal timelines and desires.

Although progress has been made in speeding up permits, and preference has been given to those in Lahaina, navigating the maze of regulations will be difficult. Securing a building permit on Maui routinely takes over a year. While regulations for areas near the ocean (Special Management Area Permits) help protect the environment and coastal areas from overdevelopment, they in turn slow down the building process. With the ongoing threat of sea-level rise, planners and landowners must confront the possibility that parts of Lahaina may never be habitable again without major adaptation efforts. Imagine owning a beautiful ocean view restaurant built on pilings over the ocean that completely burned. Is it responsible to allow that person to replace that business literally in the ocean, and if not, how are they compensated for that loss?

Beyond the physical rebuild, the community will need time to heal emotionally and psychologically. Losing family homes and places filled with memories takes a heavy toll. Rebuilding houses is one thing; restoring a sense of belonging and community is something else entirely.

Economic recovery will be uneven and slow. The University of Hawaii Economic Research Organization (UHERO) has begun releasing data on the long-term effects of the fires. Initial findings show that Maui’s tourism-dependent economy is facing serious setbacks. Visitor numbers dropped by more than 50% but have since risen to around 80% of pre-fire levels. Still, the loss of businesses and the decrease in tourism mean permanent job losses.

However, UHERO’s data also suggests a potential path for long-term recovery. If managed correctly, the rebuilding process could spark economic growth in the construction and infrastructure sectors. Moreover, there’s an opportunity to rebuild Lahaina in a way that promotes sustainability and resilience, both environmentally and economically. With careful planning, Lahaina could emerge stronger, better able to withstand future challenges—whether natural or economic.

This positive outlook hinges on long-term commitment and thoughtful planning. Collaboration between government agencies, residents, and private investors will be key. A delicate balance must be struck between preserving and enhancing Lahaina’s cultural heritage and meeting the needs of a modern economy and those who wish to call it home. At a recent ULI meeting, Mayor Bissen said “I reject the idea that this is not a sprint but a marathon. This is an absolute sprint, but when you get tired and need to rest, you must pass the baton to another sprinter.”

The recent devastation of Hurricane Helene is another reminder of how precious our communities and resources are, and how valuable our networks become in a time of crisis. Hopefully, both locally, and nationally, we will continue to learn, rebuild, and be better prepared for future challenges.

In the end, Lahaina’s recovery is not just about replacing what was lost. It’s about reimagining how this sacred, historic town can once again flourish, while honoring the memory of what it once was. The road ahead will be long—likely longer than we would wish—but with patience, determination, and compassion, Lahaina will rise again, transformed but never forgotten.