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Notice #: 05533757
Public Notices


For Commercial Development
of 52.634 Acres of Hawaiian Home Lands in Wailua, Island of Kauai, Hawaii
TMK: (4)3-9-06: PARCEL 09 AND 11

The Department of Hawaiian Home Lands (DHHL) intends to dispose of lands by public offering and negotiation. As authorized by §220.5, Hawaiian Homes Commission Act, 1920, as amended, individuals or businesses interested in leasing the property herein described shall have not more than ninety (90) days from the date this “NOTICE OF PROPOSED DISPOSITION” is last published, that date being February 11, 2008, in which to submit completed applications (proposals) for DHHL consideration.

All completed applications must be received by 4:00 p.m. on May 9, 2008. Within the next forty-five (45) days, ending June 23, 2008, DHHL shall review all applications submitted by the deadline to determine which applicants have submitted proposals that meet DHHL’s objectives and criteria. Shortly thereafter, all applicants shall receive written notification of DHHL’s determination and those deemed “qualified” may then be considered for selection as the project developer. If only one applicant is deemed “qualified”, DHHL may then negotiate the developer agreement and lease with the qualified applicant. If DHHL determines that there is more than one qualified applicant, DHHL shall re-evaluate all the relevant facts of the disposition, which may include requiring each qualified applicant to submit additional information, and shall select the qualified applicant who submitted the best proposal within the next forty-five (45) days, ending at 4:00 p.m. on August 7, 2008. After notification to all qualified applicants, DHHL may then commence negotiating all the details of the disposition with the selected developer, including but not limited to base rents, percentage rents, sub-lease participation and providing benefits to promote native Hawaiian socio-economic advancement, provided the terms of the project developer agreement and lease are not less than those proposed by the selected developer in the initial application.

Land to be disposed: The property to be disposed, identified as Tax Map Key No. (4)3-9-06: parcel 09 (41.152 acres) and a parcel 11 (11.482 acres), contains a total of approximately 52.634 acres (2,292,737 square feet) of land, and is located in Wailua, Island of Kauai, Hawaii.

Purpose/Use: The property is being offered for commercial development, which includes, but is not limited to, retail, resort/timeshare, wholesale, industrial, office and/or other commercial uses. Improvements and uses shall conform to those allowed in the County of Kauai’s RR-20 (Resort) or CG (General Commercial) zoning districts and all applicable permit requirements consistent therewith, except that DHHL has imposed a limit of 800 units if a resort/timeshare development is proposed (instead of the maximum 1052 units or 20 units per acre allowed under Kauai County’s RR-20 zoning).

Term: The term of the lease shall be for a minimum of 25 years and a maximum of 65 years.

Rent: Applicants must submit a sealed rent proposal that includes: (a-1) the amount the applicant proposes to pay for the first ten (10) years of the lease which may be paid annually at the beginning of each year, or (a-2) the amount the applicant proposes to pay in one lump sum prepayment made within 90 days after the developer agreement and lease negotiations are completed; and (b) the rent applicant proposes to pay over the remaining fifty-five (55) years of the lease.

All qualifying sealed rent proposals shall be equal to or greater than:

a-1) The minimum rent of $4,630,900 per year, paid annually for
the first 10 years;
a-2) The MINIMUM LUMP SUM PREPAYMENT of $35,000,000 for the first
ten (10) years of the lease (amount a-1 above discounted at 6%
per annum);
b) The minimum rent for the remaining fifty (55) years is:
$4,630,900.00 per annum for years 11 through 30
$8,430,300.00 per annum for years 31 through 40
$11,329,600.00 per annum for years 41 through 50
$15,226,000.00 per annum for years 51 through 60
$20,462,500.00 per annum for years 61 through 65

The rent for the remaining fifty-five (55) years may be proposed in any annual amount, so long as the present value of the total combined proposed compensation for these fifty-five (55) remaining years is not lower than the present value of the total combined minimum annual rent for those same fifty-five (55) remaining years as shown above. For comparison purposes only, a 6% discount rate will be used to calculate the present value of each sealed rent proposal.

Negotiations: As a part of the requirements for entering into a Project Developer Agreement and general lease for the subject property, the applicant must be willing and able to make the proposed Minimum Lump Sum Prepayment within ninety (90) days of executing the Project Developer Agreement and lease (or within such other timeframe agreed to in the negotiating period) or actively participating in the construction of infrastructure for a minimum of 188 ready-to-build, single-family residential lots on lands in close proximity to the subject property, and over-sizing said infrastructure to accommodate future phases of the residential subdivision that may contain as many as 547 additional single-family residences. The cost for said construction of infrastructure can be limited to the amount of the Minimum Lump Sum Prepayment or a higher amount should additional ground rent offsets be acceptably negotiated.

Telecommunication Service: Sandwich Isles Communications, Inc. (SIC) will provide telephone and broadband services to the project at a time when such services are needed.

Chapter 343, Environmental Assessment: While DHHL intends to provide a partial or generalized Environmental Assessment (EA) for the property, the selected developer shall be required to complete compliance with Chapter 343 of the Hawaii Revised Statutes, as amended, prior to executing the lease and starting construction activity on the site. Such compliance shall assess the impacts that the actual planned development of the subject parcels will have on the surrounding environment.

The Department of Hawaiian Home Lands reserves the right to cancel or modify this disposition of its lands at its sole discretion.

Packets containing an application form, property information and other requirements for completing the initial application process are available for pick up by prospective applicants during regular office hours at DHHL’s Honolulu Office located at 1099 Alakea Street, Suite. 1230, or at the district offices located on the neighbor islands. Please call (808) 586-3858 (Honolulu) for the locations of neighbor island district offices and/or the Oahu office where packets can be picked up. Arrangements may also be made for receiving an electronic copy of the Information Packet. All other questions or concerns regarding this offering may be directed to Noel Akamu, DHHL Property Development Manager, at (808) 587-6432 on Oahu.

Date: Honolulu, Hawaii

State of Hawaii
Micah A. Kane, Chairman
Hawaiian Homes Commission
(SB05533757 1/28, 2/14, 2/11/08)