Posted on: Tuesday, October 12, 2004

State terminates Kaka'ako aquarium deal

By Andrew Gomes
Advertiser Staff Writer

The effort to build a world-class aquarium on state-owned waterfront land in Kaka'ako suffered a setback yesterday, as the private developer and the state terminated a preliminary development agreement.

Kajima Urban Development and the Hawai'i Community Development Authority agreed to end negotiations to lease 11 acres of state property for the estimated $200 million to $250 million ocean science center.

The decision frees up a prime redevelopment site adjacent to Kewalo Basin and Point Panic that now will be wrapped into a larger, 30-acre site that the state intends to offer to private developers through a competitive bid process.

"Anybody who's interested and believes they are qualified can put their hat in the ring," said Dan Dinell, executive director of the development authority. "We want the best possible ideas for the benefit of the people of Hawai'i."

Kajima Urban Development said it remains committed to its aquarium project, and that it intends to pursue the ocean science center if it is eventually selected as master developer of the roughly 30 acres.

"We believe that the ocean science center should be integrated into the overall development of Kaka'ako," Marvin Suomi, president of California-based Kajima, said in a statement.

A competing aquarium planned by the master developer of Ko Olina Resort & Marina about 25 miles away on O'ahu's Leeward coast has raised questions about whether both could financially succeed, but Kajima and Ko Olina officials insist their projects would be distinct enough to coexist.

The developer, a subsidiary of Japanese construction giant Kajima Corp., two years ago was granted exclusive rights to negotiate a lease for its 11-acre project with the state agency that oversees redevelopment in Kaka'ako.

Since then, interest in Hawai'i by real-estate developers has grown, and the state's Kaka'ako lands have drawn two unsolicited development proposals.

The first came in July from Kajima Urban Development and General Growth Properties, the Chicago-based shopping center developer that owns Victoria Ward and Ala Moana centers.

The partnership was interested in adding residential units, retail and entertainment space, parking and possibly a hotel on sites around the proposed aquarium site.

Then in August the owner of Kaka'ako's John Dominis restaurant, former politician D.G. "Andy" Anderson, submitted a proposal to develop a Pacific Rim business trade center surrounded by retail shops, restaurants, a farmers market and an outdoor concert venue on land likely to be included in the state's planned request for proposals.

Anderson's plan, which incorporated office, residential and possibly hotel units in thin buildings designed to look like "sails" attached above twin canoe-shaped hull structures, accommodated the aquarium proposed by Kajima.

Anderson yesterday said he still believes an aquarium compliments the other elements of his proposal and is talking to the Kajima development company about possibilities.

The development authority said yesterday that it plans to solicit developers publicly at a later unspecified date, and that it anticipates "a great deal" of interest. There is no guarantee that any of the other developers that are expected to submit bids would include an aquarium in their plans.

"After making a commitment on the Kaka'ako site for an ocean science center over a year ago, the larger potential for Kaka'ako has become increasingly clear to both KUD and HCDA," James Kometani, agency chairman, said in a statement.

"In essence, we both came to the conclusion that the multiple uses and their interdependency call for a master developer and not the fractured development of individual sites," he said.

Known as Kaka'ako Makai, the area makai of Ala Moana between Kewalo Basin and Honolulu Harbor has been the focus of the state's most important redevelopment effort since Aloha Tower Marketplace in the early 1990s.

A state effort in 1998 to solicit developers for 18 acres in the area drew nine proposals. But the final selection, a plan by Anderson that included a 130-foot-high Ferris wheel surrounded by retail shops and restaurants, was rejected in 1999.

Since then, there have been several improvements to roads and construction of the University of Hawai'i medical school, which is being built by a Kajima affiliate.

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