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The Honolulu Advertiser
Posted on: Thursday, January 10, 2002

Produce Center relocation deal clears way for med school

By Andrew Gomes
Advertiser Staff Writer

The state has reached a settlement with a group of produce distribution companies in Kaka'ako to move the businesses to Sand Island, clearing the way for development of the University of Hawai'i medical school.

The Hawaii Community Development Authority, the state agency that owns 10 acres in Kaka'ako slated for the university project, yesterday agreed to pay $7 million to terminate a lease with Produce Center Development Ltd. and its subtenants, and move them to a state-owned site at Kapalama Military Reservation.

Produce Center, a distribution facility used by eight companies, has until Aug. 31 to move. The state Agriculture Department, which also has a facility on the property planned for the medical school, is in the process of constructing a new building at the Kapalama site that should be ready by the end of July.

The money to move the Produce Center will come from UH out of a $13 million appropriation from the Legislature, of which $7 million had been earmarked for tenant removal.

Produce Center had a 55-year lease that didn't expire until 2029. The center will receive $3.4 million for improvements on the Kaka'ako property. Subtenants will receive another $3.4 million for their improvements.

The subtenants are Y. Fukunaga Products, Armstrong Produce, Dole Distribution Center, Japan Food (Hawaii), APL Florist, S. Yamauchi Produce, Aloha Products and Manson Products.

The state also agreed to give Produce Center $200,000 to rent temporary space, because the Sand Island facility is not expected to be ready by Aug. 31. Produce Center had asked for the money or a 90-day extension to vacate the premises.

UH hopes to break ground on the first phase of a new John A. Burns Medical School and Cancer Research Center as early as September. The $300 million project is envisioned as an anchor to a biotech park, and a key piece in the redevelopment of Kaka'ako.

Reach Andrew Gomes at 525-8065 or agomes@honoluluadvertiser.com