Aloha Stadium redevelopment joins list of troubled, delayed Hawaii government projects

Oct. 3—Hawaii is littered with big public-facility development projects that have taken exorbitant stretches of time to produce compared with plans.

In early 2022 a veteran Hawaii attorney specializing in real estate development said eight to 10 years was a realistic range for the state to replace Aloha Stadium instead of by 2023, the state's original estimate for completion.

It turns out the appraisal by Benjamin Kudo at a University of Hawaii Board of Regents meeting is a lot closer to the state's latest estimate for completing the project : 2027.

Kudo, whose term as a regent ended in June, understands complex land development projects involving local government, and Hawaii is littered with big public-facility development projects that have taken exorbitant stretches of time to produce compared with plans.

To mention a few :—It took over a decade to develop the Hawai 'i Convention Center.—An initial segment of Honolulu's rail system was supposed to be running in 2018.—The H-3 freeway opened in 1997 after 34 years of work.—Around Honolulu Harbor's Aloha Tower landmark, there has yet to materialize a mix of residential towers, hotel rooms and offices anchored by a retail center that opened in 1994 despite planning that began in 1981.

There are, of course, examples of big state and county development projects that have gone well. But rebuilding Aloha Stadium has fallen into the jacked-up project category as part of an ambitious plan to have private developers create retail, restaurants, a hotel, housing and other things in what has been dubbed the New Aloha Stadium Entertainment District, or NASED, on 98 acres of state land around the existing 47-year-old stadium in Halawa.

Compared with the convention center, rail, H-3 and Aloha Tower, NASED most closely resembles Aloha Tower in structure and purpose.

State leaders in 1981 created the Aloha Tower Development Corp., a new state agency, to solicit plans from private developers to revitalize run-down industrial waterfront land owned by the state.

Initial proposals were considered in the early 1980s, but it took until 1989 for the agency to approve a winning plan from competing proposals.

The selected vision featured a "festival marketplace " retail complex, two condo towers, an office tower, a business hotel, a cruise terminal, 2, 000 underground parking stalls and a pedestrian overpass over Nimitz Highway. Revenue to the state under a 65-year land lease was projected to be $4 billion.

Aloha Tower Marketplace opened in 1994, but nothing else was built because of a faltering economy.

Since then a handful of alternate development proposals were pursued to no end before state interest to realize the initial goal was dropped. In 2012, Hawaii Pacific University bought the retail complex for its own use.

The convention center was built, but only after contentious decisions over competing sites and development arrangements that strung out the effort.

Initially, tourism industry stakeholders formed a nonprofit council in 1984 to push for a convention center in Waikiki, and potential sites included Fort DeRussy, the Honolulu Zoo, part of the Ala Wai Golf Course and Kapiolani Park.

In 1988 the Legislature created an agency to solicit proposals from developers to build the facility on the site of the International Market Place for free in return for a developer receiving high-density building rights, which prompted a revolt from tenants and failed because a developer was unable to obtain financing.

A rival plan endorsed by the Honolulu City Council was to have a developer who owned land at the corner of Kapiolani Boulevard and Kalakaua Avenue pay for most of a new convention center on the site where the developer would also build four hotel towers.

This plan was reviled by the hotel industry, and ultimately the state bought the land for $136 million and paid a contractor $200 million to build the center, which opened in 1997.

H-3 between Halawa Valley and Kaneohe took three decades of effort, during which there was organized public opposition, environmental and archaeological challenges, litigation, route changes and a cost that ballooned to $1.3 billion from $430 million.

The city's planned 20-mile, 21-station rail system from East Kapolei to Ala Moana Center has encountered many of the same challenges as H-3, though construction difficulties have also plagued the project, originally slated to begin service four years ago.

Rail construction began in 2012, three years late, and the estimated cost soared to $12.5 billion from $4 billion. An initial segment of nine stations from East Kapolei to Aloha Stadium is now undergoing tests, and Mayor Rick Blangiardi aims to cut costs to $9.1 billion by ending the route 1 mile and two stations short in Kakaako.

Former Mayor Kirk Caldwell noted that rail and NASED were both over-promised and underdelivered, but he is hopeful that both succeed because they will produce important community benefits.

Local developer Stanford Carr said one flaw with the state's stadium effort is that the state intended to operate and generate revenue from a new stadium that developers would design, build, partly finance, and maintain for 30 to 40 years.

Carr is a partner in one of two teams competing to bid on redeveloping 73 acres surrounding Aloha Stadium but is not competing to replace the stadium.

Gov. David Ige two weeks ago said an effort is underway to simplify and accelerate the public-­private partnership arrangement to produce a new stadium and that $350 million appropriated for NASED in general is enough to pay for a new stadium.

But on Thursday, Mike McCartney, Ige's director of the state Department of Business, Economic Development and Tourism leading the change, said his office intends to have a new stadium developed without a private partner.

Two state officials involved with NASED—Aloha Stadium Manager Ryan Andrews and Chris Kinimaka, public works administrator at the state Department of Accounting and General Services—said last week that they expect any change in direction for the project to result in further delay.

Kudo said it's difficult to update his prior estimate for developing a new stadium without knowing specifics of a revised plan and what is done with it by a new governor to be elected in November.

Yet Kudo allows that it "easily " could exceed his earlier assessment.