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The Honolulu Advertiser
Posted on: Friday, May 5, 2006

OHA pursues Moanalua deal

By Gordon Y.K. Pang
Advertiser Staff Writer

Board members of the Office of Hawaiian Affairs agreed yesterday to pursue purchase of Moanalua Gardens.

OHA trustees voted 7-0, with two abstentions, to set in motion a bid to acquire the 26-acre property "for the purpose of economic development opportunities and/or to continue to preserve and enhance the cultural and historical aspects of the property."

Sandwiched between Moanalua Freeway and Moanalua Elementary and Intermediate schools, the gardens are owned by the Estate of Samuel Mills Damon. The gardens and nearby Moanalua Valley are on the sales block.

Purchase of the gardens would mark OHA's latest foray into the real estate market. It recently was part of a group of government agencies that purchased Waimea Valley. It also purchased the Wao Kele o Puna Rainforest on the Big Island.

Moanalua Gardens is home to the Prince Lot Hula Festival, which is the largest noncompetitive hula festival in the state and is named after Kamehameha V, the gardens' former owner. The site, which has an assessed value of $5.5 million, includes historically significant buildings.

OHA administrator Clyde Namu'o said the area is considered sacred because it is believed to be the burial ground for a pre-Kamehameha O'ahu chief.

Besides preservation, Namu'o said, trustees see investment potential, noting commercial development makai of the freeway.

Trustee Dante Carpenter, a strong proponent of the proposed purchase, said the gardens site could be candidate for OHA's future headquarters. Currently leasing space in a Cooke Street office building, OHA trustees are eyeing several sites in lower Kaka'ako for new offices.

Timothy Johns, Damon's chief operating officer, said he is encouraged by OHA's interest. He said several entities have expressed interest in the Moanalua Gardens parcel.

"There are parties who have continued to express interest and we've been going back and forth with them," Johns said. "So, we are really looking forward to seeing what OHA's offer is going to look like."

A sales agreement would be contingent upon successful completion of due diligence, according to the OHA vote. OHA Chairwoman Haunani Apoliona and trustee Colette Machado abstained from the vote. Apoliona said she thought due diligence the phase in a business transaction when parties evaluate each other and the viability of a deal should have been completed before yesterday's vote.

The board also authorized its staff to negotiate with the estate "a backup offer" for the purchase of Kamana Nui and Kamana Iki valleys, known collectively as Moanalua Valley, subject to approval by the trustees. The prospective buyers' group includes the state Department of Land and Natural Resources, the nonprofit Trust for Public Land, the Army and the U.S. Fish and Wildlife Service.

The estate last month entered into a sales agreement with the Trust for Public Lands for the 3,714-acre property. The sale is pending completion of due diligence by the buyers.

The valleys are considered a sanctuary for endangered and rare birds and plants. In the 1600s, the area was designated by O'ahu's King Kakuhihewa as the center of hula and chanting.

In other action, the board voted unanimously to grant Kawaiaha'o Church $1 million for renovations. The church will receive $500,000 this year and $250,000 in each of the next two fiscal years. The renovation plans include a new multipurpose and office facility, nursery, archives, social hall and kitchen.

Reach Gordon Y.K. Pang at gpang@honoluluadvertiser.com.