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FM station in Hawaii sells for $1000...must be a catch

J

joebtsflk1

Star Participant
$1000, and they'll even throw in the transmitter plant. Sounds too good to be true!

Indeed within the pending sales contract for KQMT Paia, on the island of Maui is the renegotiation of the tower lease for KQMY. Seems the seller was leasing the tower site on Mt. Haleakala from a "family related company." Buyer will have to set up new terms for the tower site rental.
 
Kelly A said:
Believe it or not, Hawaii is a really tough radio market.
Click to expand...

Island markets tend to be horrible. Puerto Rico, Virgin Islands, Key West.

One theory is that, with things brought in by ship or air (or a long highway to the Keys), the cost of living is so high that there is less discretionary income.
 
KQMY basically covers only Maui, reaching about 150k residents.

It's like having a station in Lima, Ohio - but with the added condition that your station Lima Ohio couldn't reasonably get advertisements from the tourism council for Michigan, or theme parks in Indiana, or a concert venue in Cincinnati because your listeners had no means to reach Indiana or Michigan or Cincinnati.

Add to that the fact that 21% of the total economy on Maui is in the tourism industry, and tourists are neither frequent nor reliable users of radio:
You have a station with a fairly small base of possible advertisers in a small market with no tower site. Easy to see why its value is very low.
 
PTBoardOp94 said:
KQMY basically covers only Maui, reaching about 150k residents.
Click to expand...

That is actually a pretty large market for not too many stations.

The US Virgin Islands have 100,000 persons and 26 stations.

The Florida Keys with 77,000 people has 32 stations.

Both of these have a much higher percentage of the economy sustained by tourism.
 
This almost seems like an LMA instead of a straight up purchase. Instead of lease payments every month for the privilege to operate the station, the seller basically gives away the station because I'm guessing the seller's family has the only viable tower location to lease on the mountaintop...six of one, half a dozen of the other?
 
It could be a sale in name, but really a license/ownership transfer to a family member, friend, or different corporate structure. That's why the listed number is so low.

A few years ago, I had sniffed a station licensed to Hilo on the Big Island. As I recall they were asking about $75K. Problem was (among many things), the station had been off the air for about six months and what few advertisers there, had all left.

The reported reason the station was silent, was because of a lost transmitter site lease. In the process of starting due diligence, I discovered the (then) current owners had even not filed for an STA to be off the air, and had a not-reported ownership violation involving investors from a different country, who rightfully expected return on their investment in the event of a sale. Hot potato!
 
For $1000 I’d just find a nice rooftop to put the antenna on, then play radio and not even care about advertising.
 
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