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The Honolulu Advertiser
Posted on: Tuesday, October 20, 2009

Dole expands plan to sell Oahu land


By Andrew Gomes
Advertiser Staff Writer

Dole Food Co. has expanded its effort to sell land it owns in Hawaii, according to a recent securities filing in which the California-based firm said it is planning or contemplating the sale of 11,000 acres on Oahu.

The initiative by the business founded in Hawaii more than 150 years ago aims to pay down debt, and follows the sale of 2,140 acres in Waialua last year.

Dole last year said that it was trying to sell 5,000 acres on the North Shore between Wahiawä and Haleiwa, but since then has more than doubled the amount of land it is holding for sale.

If Dole were to sell 11,000 acres, the company would still retain considerable real estate holdings on Oahu and remain one of Hawaii's largest private landowners. Still, such a disposition of land would further diminish the company's connection to a place deeply rooted in its history.

In the filing earlier this month, Dole said it expects to sell $94 million of assets — primarily Hawaii land — in the next 12 months.

The company said that as of Jan. 3 it classified 9,000 acres in Hawaii as assets for sale. Dole also said other Hawaii parcels are currently under evaluation for potential sale. In all, Dole said it could sell 11,000 acres, or less than half the 26,000 acres it owns on Oahu.

Dole wouldn't identify the land held for sale, but said the property excludes 2,700 acres on which it grows pineapples and 195 acres on which it farms coffee and cacao.

"Dole is committed to continuing our pineapple and related crops in Hawaii," said company spokesman Marty Ordman.

The private company owned by billionaire David Murdock made the disclosure about the Hawaii land sale effort in a registration statement filed as part of a plan by Murdock to sell a roughly 40 percent stake in Dole through a public stock offering this week.

Murdock aims to raise roughly $575 million in the stock sale to pay down debt.

The land sale effort similarly seeks to reduce Dole's roughly $1.9 billion of debt.

Much of the company's debt was acquired as part of Murdock's 2003 purchase of Dole, then a publicly traded company, in a deal valued at $2.5 billion.

In the last couple of years or so as Dole struggled financially, debt reduction has been a key focus of the company. Selling noncore assets, including Hawaii property, last year helped the world's largest producer of fresh fruit and vegetables post a $121 million net profit after two years of losses.

Among the asset sales last year was 2,140 acres in Waialua bought by seed research company Pioneer Hi-Bred International Inc., which had previously leased the property from Dole. Pioneer paid $39.3 million for the land.

Dole also retained commercial real estate brokerage firm CB Richard Ellis Inc. last year to market 5,000 acres in Wahiawä that are partly fallow and partly leased to farmers growing crops or raising cattle. That property is still on the market.

This year, Dole's goal is to sell $200 million in assets, the company said in its filing.

Hawaii real estate represents close to half that goal, though Dole would still own about 15,000 acres on Oahu if the land sale effort is successful.

Of Dole's 26,000 acres on the island, all but 2,895 acres farmed by the company is either leased to others for farming or is pasture or forest preserve land.

Dole's property is separate from land owned by another company owned by Murdock, Castle & Cooke Inc. That firm, which owns 98 percent of Länai and develops residential and commercial property in Hawaii and the Mainland, is Hawaii's third-largest private land-owner with about 95,000 acres.

Other Hawaii landowners with more real estate than Dole include Kamehameha Schools, Parker Ranch, Alexander & Baldwin and James Campbell Co.

According to data from 2003 in last year's state Data Book, Dole was the seventh-largest private owner of land in Hawaii.

Dole's history in Hawaii dates back to 1901, when James Dole founded the company as Hawaiian Pineapple Co. and made pineapple production Hawaii's second-largest industry.

Over the decades, pineapple production has been dramatically scaled back, though Dole remains one of the two largest pineapple producers in the state, with Maui Land &Pineapple Co.