Mortimer Zuckerman is the editor in chief of U.S. News & World Report, and the chairman and co-publisher of the New York Daily News.  He is the chairman of Boston Properties and has extensive real estate holdings across the U.S., and he  is currently ranked as the 182nd-richest man in America on the Forbes 400.

I was reading an interesting interview of Zuckerman in Forbes, in which he talks about how he has managed to pull off so much success in commerical real estate over the past couple years. The most interesting thing he mentions applies pretty directly to Oahu real estate, though Zuckerman doesn't own property here (yet.) 

He says, "I think that the real estate market is really made up of many markets. Boston Properties is in a very few selective markets, all of which are what we describe as supply-constrained. Washington, for example, is constrained because it has height limits and sites are very difficult to acquire. Cambridge, because sites are impossible to acquire. In Boston, we're mainly in the Back Bay, which is sort of like the Upper East Side of New York, where again it is very difficult to acquire sites and build major buildings."

So why has Oahu real estate done so well in the last 5 years?  Why haven't we seen price huge decreases like other areas?  Simple: supply.  There just isn't enough land on the island of Oahu for the 1 million people who live here.  There is hardly vacant land that can be developed for residential use.  Sure there is a lot of vacant preservation land, conservation land, and agricultural land, residential and commercial land is nearly gone.  In Honolulu, it IS gone. The only place you can find any substantial land for development anymore is in Kapolei.

Oahu isn't getting any bigger, but the population is continuing to grow.  Do the math.