LEGAL NOTICE
PROPOSED DISPOSITION OF HAWAIIAN HOME LANDS
Industrial-Commercial Mixed-Use Development Including Raceway
139.297-acre Parcel in Kalaeloa, Oahu, TMK (1) 9-1-013:061
As authorized by §220.5, Hawaiian Homes Commission Act, 1920, as amended, the Department of Hawaiian Home Lands (DHHL) invites interested persons to submit their applications, qualifications and experience and proposals for the development of the land described herein (the “Property”). Individuals, partnerships, corporations, limited liability companies or other business entities interested in developing the Property shall have ninety (90) days from the date this Legal Notice is last published – that date of last publishment being June 19, 2024 – in which to submit the following for DHHL consideration:
1. An application to be project developer;
2. A statement of qualifications and experience;
3. Conceptual plans and description of the proposed development;
4. A proforma development budget and schedule; and
5. Proforma financial statements for the initial 10 years of commercial operations.
Submission items 3–5 shall be submitted in a sealed envelope. Only complete submission packages (with all five submission items) received by 4:00 p.m. on Tuesday, September 17, 2024, shall receive full consideration by DHHL.
DHHL will initially review submission items 1 and 2 to determine which applicants have met the minimum qualifications for selection as the project developer of the Property. Within ten (10) days of the submission package deadline – i.e., by not later than Friday, September 27, 2024 – said initial review shall be completed and DHHL will promptly thereafter notify the applicants determined not to be minimally qualified to move forward and will return their sealed envelopes to them unopened.
On Friday, September 27, 2024, DHHL shall open the sealed envelopes of the applicants determined to be minimally qualified for further consideration. If only one applicant has been determined to be qualified, DHHL may proceed to negotiate the details of a Project Developer Agreement (“PDA”) and General Lease (“GL”) with that qualified applicant. If there are two or more qualified applicants, then DHHL shall, within the next forty-five (45) days – i.e., by not later than Monday, November 11, 2024 – review, score and rank the respective submission packages in their entirety (i.e., considering all of submission items 1-5) and notify the qualified applicant with the highest ranking submission package of their selection to negotiate the details of a PDA and GL. If DHHL and the initial qualified applicant selected for negotiation are not able to agree upon final terms of a PDA and GL within sixty (60) days of their selection for negotiation – i.e., by not later than Friday, January 10, 2025 – subject to extension by mutual agreement of the negotiating parties, then DHHL may successively select the qualified applicant with the next highest ranking submission package for negotiation of the details of a PDA and GL, subject to the same 60-day negotiation period with extension by mutual agreement.
Information Packets containing an application form, a request for a statement of qualifications and experience, property information, objectives and criteria, and other requirements for completing the submission package process are available on DHHL’s website: https://dhhl.hawaii.gov or for pick up by prospective applicants during regular office hours at DHHL’s Oahu Office located at 91-5420 Kapolei Parkway, Kapolei, HI, or at DHHL’s District Offices in Hilo and Waimea, Hawaii; Hoolehua, Molokai; Wailuku, Maui and Lihue, Kauai.
Land to be Disposed: The Property, identified as Tax Map Key No. (1) 9-1-013:061, contains approximately 139.297 acres, is partly industrial developed land and partly vacant land, and is directly South/West of, and adjacent to, the main runway of the State of Hawaii airport operated at the former Naval Air Station Barbers Point.
Nature of Development; Permitted Use: Combination of: (A) a first-class motorsports raceway and complex; and (B) a complementary industrial-commercial mixed-use project that would be permitted under an IMX-1 zoning designation of the City and County of Honolulu (if applicable). Proposals including any type of residential development will not be accepted.
Term: The PDA and GL shall be co-terminus at sixty-five (65) years from the commencement of commercial operations (to be defined in the agreements) and shall be cross-defaulted such that the termination of either agreement shall automatically terminate the other.
PDA Due Diligence: The PDA will provide a right to enter the property to conduct customary due diligence activities for a maximum one (1) year due diligence period. If the Developer opts in writing to proceed with the Project on or before the end of the due diligence period, then it shall promptly: (i) file with DHHL a good and sufficient bond conditioned upon the full and faithful performance of all the terms, covenants and conditions of the PDA; and (ii) execute and deliver the GL and comply with providing all deliverables thereunder, including proof of holding the required types and coverages of liability insurance.
Contract Consideration: Consideration to DHHL for entering into the PDA will be a negotiated share of the gross revenue of the Project. Lease rent due DHHL under the GL shall be set by an independent third-party appraisal to be commissioned by DHHL for delivery during the due diligence period afforded in the PDA. The appraisal shall determine the fair market value of the Property based on its “Permitted Use” set forth above and as if unencumbered by the PDA. The lease rent paid to DHHL under the GL shall be credited against the gross revenue share due to DHHL under the PDA for the same period. As such, over any measurable period, the effective payment to DHHL under the PDA shall be the amount, if any, by which the negotiated share of gross revenue for the period exceeds the lease rent paid to DHHL under the GL for that same period.
Chapter 343 Environmental Assessment: Prior to commencement of any demolition or construction on the site, the Developer shall comply with Chapter 343 of the Hawaii Revised Statutes, as amended, which requires that an assessment be made to determine the impacts the proposed development may have on the surrounding community and environment. Such compliance shall be considered completed upon the issuance of a Finding of No Significant Impact (FONSI) or final approval and acceptance of an Environmental Impact Statement (EIS), whichever is applicable.
No State Funds: The Developer shall be responsible for all funds needed to develop the Property. No State of Hawaii funds shall be used in the development of the Property.
“As-Is”: The Developer will accept the Property “As-Is”, with all conditions, encumbrances, faults and deficiencies, known or unknown. Without limiting the foregoing, the Developer shall acknowledge that environmental contamination, the presence of cultural/archaeological sites, and substandard provision of electrical, gas, water, sewage removal, communications, and internet connection utilities are suspected or known conditions present on and affecting the Property.
Community Benefits: The Developer will be required to engage in community outreach and to negotiate a benefits package to be provided by the Developer to promote native Hawaiian socio-economic advancement, including support for community development, job training and placement, and educational and/or cultural programs for residents of Hawaiian home lands on the Island of Oahu.
Beneficiary Consultation: During this disposition process, DHHL will consult with the Hawaiian Homes Commission and the beneficiaries of the Hawaiian Home Lands Trust regarding the Project and the proposed use(s) of the Property. In furtherance of meaningfully considering the outcomes of such consultation, DHHL reserves the right to modify or cancel this disposition of its lands at its sole discretion.
For additional information and/or to schedule a site inspection, you may contact Russell K. Kaupu, Property Development Agent, Office of the Chairperson, DHHL at (808) 620-9525 or Russell.K.Kaupu@hawaii.gov.
Dated: Honolulu, Hawaii May 31, 2024
State of Hawaii
Department of Hawaiian Home Lands
By: Kali Watson, Chairperson
Hawaiian Homes Commission
Honolulu Star Advertiser
(Local Newspaper Publication)
Dates: June 5, 12 & 19, 2024
(SA1457072 6/5, 6/12, 6/19/24)
