Aloha Tower project to open up for bid
By Andrew Gomes
Advertiser Staff Writer
The state agency overseeing redevelopment around Aloha Tower decided yesterday to solicit development proposals instead of negotiating exclusively with a company that wants to build a $227 million mixed-use project at Piers 5 and 6.
The Aloha Tower Development Corp. cited interest from at least four local and Mainland developers since considering the unsolicited mixed-use proposal at a meeting in June.
Rainbow Pier Development LLC, a startup firm initially interested in developing a ferry service based at another site at Honolulu Harbor, proposed developing a ferry terminal, hotel, time-share, office building and enough parking to make up the shortage at Aloha Tower Marketplace — all on seven acres diamondhead of the retail marketplace.
But the agency last month told Rainbow Pier executives it needed detailed financial projections before it would consider exclusive lease negotiations.
Agency staff said yesterday that Rainbow Pier had not provided the requested information.
Rainbow Pier Vice President Wayne Vieira told agency board members that the firm's development partner, California-based James Ratkovich & Associates, was no longer involved with the proposal.
Vieira thanked the board for its patience and said Rainbow Pier expected to find a new partner and bid for the redevelopment opportunity.
"We got delayed, and it was our fault," Vieira said after the decision. "(The agency) has to move on it."
Aloha Tower Development Corp. has drafted a request for proposals that could be ready to advertise nationwide in two weeks, said program specialist Dan Orodenker.
He said the process of finding a developer could be done in six months.
Orodenker said it wouldn't be appropriate to disclose who has expressed interest, but he expects more, given that the property is a rare find, a large urban waterfront development site in Honolulu.
Under the request for proposals, the agency has set minimum requirements to provide a ferry terminal, parking and 30,000 square feet of office space for the state Transportation Department's Harbors Division. Other elements would be left to the imagination of developers.
The area available for redevelopment includes property on either side of Aloha Tower Marketplace, from Piers 5 to 14.
The marketplace was built in 1994 at a cost of $100 million. It was supposed to be the first phase in a $700 million, five-phase project.
But the developer, Aloha Tower Associates, ran out of money and could not complete additional phases. It defaulted on lease rent payments to the state, which two years ago reclaimed development rights.
Criteria for selecting a new developer is geared to finding the most capable and financially strong applicant, with only 40 percent of the consideration applied to the development plan and lease terms with the state.
After selecting a developer, any proposed project still would be subject to negotiation and approval of the agency board.
