Building Projects Stretch Across Big Island

The Big Island has been slow to develop, partly due to Hawai‘i’s complex land use laws, tight environmental regulations and the fact that there is often strong opposition from locals and Native Hawaiians.

According to HRS 343, any project involving state land or state money may require an environmental review. Also, the majority of land in Hawai‘i is currently designated either conservation or agriculture, both of which exclude the possibility of major developments.

The Hawai‘i Data Book series says that there are a total of 2,573,400 acres of land on Hawai‘i Island.

In the State of Hawai‘i, 47.99% of land is designated for conservation, 46.94% is designated for agricultural use, 4.81% is designated for urban development and 0.26% is designated for rural areas. For that reason, developers must battle to have the land reclassified.

It is very common to hear about developers, who after decades of battle, give up. However, Hawai‘i Lumber Products Association predicts 2019 will bring even higher demand for construction.

Which developers will succeed on the Big Island in the near future and which will fold?

Hilo District

In October 2018, the Hawai‘i Supreme Court gave its seal of approval for developers to begin the new $1.4 billion Thirty Meter Telescope (TMT) above Maunakea. TMT will be larger than the 13 telescopes already atop the mountain. Developers were met with strong opposition from Native Hawaiians who believe the site to be sacred. However, plans are proceeding. Parts are scheduled to be shipped from Canada this summer with sights set on full operation within eight years.

The Pi‘ilani Partners LLC plan for a bottling plant at the intersection of Pi‘ilani and Mililani streets in Hilo was recently deferred indefinitely. The developers planned to drill approximately a 1,000-foot well at the site and tap into the Mauna Kea aquifer.

Another major development plan in the Hilo District is Hu Honua’s wood-burning power plant in Pe‘epekeo, which would burn 30 truckloads of eucalyptus trees daily in order to be able to provide electricity to power 14,000 Big Island homes. Since Hu Honua has yet to receive final approval to sell the electricity to HELCO, the company is taking a big risk. Hu Honua plans to extract 21.6 million gallons of polluted water daily from wells, circulate it once past a steam turbine and other equipment, and then re-inject it into the ground. “Reject” water that contains too many impurities will be discharged daily, along with around 10,000 gallons of combined water from the plant’s boiler and cleaning operations.

UPDATE: The state Supreme Court on Friday, May 10, overturned the Public Utilities Commission’s 2017 decision and order approving the amended power purchase agreement between Hawaii Electric Light Co. and Hu Honua Bioenergy LLC. The court’s 5-0 decision sends the matter back to the PUC for further proceedings. Hu Honua President Warren Lee said he is disappointed by the ruling, which it said would delay bringing more renewable energy to the island.

Hāmākua District

Steve Shropshire, proprietor of Aloha Green LLC, is working on two major development plans for the Hāmākua area, Hakalau Plantation Center (HPC) and Ku‘u Papaikou. The 8.3-acre Hakalau site Shorpshire hopes to turn into a vibrant hub for agri-businesses and a gathering place for social interaction complete with tasting and retail facilities, eco-tours to area farms, and a unique opportunity to visit an ahupua‘a. He wants to restore the two remaining sugar mill warehouses inHāmākua into a brewery, restaurant and plantation museum. He’s also of hoping to add 13 additional warehouse buildings where farmers will lease affordable space for storage, cleaning and processing of bulk commodities. He has received permits for the cafe, distillery and brewpub and hopes to complete by November of 2019 and begin the additional 13 buildings for agricultural production and processing by January 2020.

Ku’ u Papaiko development plan. PC: Steve Shropshire, April 2019

The second development, Ku‘u Papaiko, will be a diverse agricultural community. All of the homes in the development would be affordable housing and Shropshire is thinking 20 to 30% will be affordable rentals. The property is strategically located because it is connected to the Papaiko wastewater system. He wants to create an agricultural village where at least half the land will be set apart for miniature gardening plots for individuals, communal agriculture (managed by a nonprofit), walking trails and pavilions where people can gather.

Shropshire is gathering community support and will continue to have meetings to get input.

“There will always be people who want development and people who don’t want development, and at times it can be very polarizing,” said Shropshire. “But I think, in most cases, the world isn’t black and white—it is grey.”

“We need development,” he said. “We need smart development… There is a need for housing on the Hāmākua Coast. Families are leaving Hawai‘i for other opportunities because there aren’t any here…”

He continued, “Mayor Kim is encouraging me to go forward on this project and providing a lot of moral support to me. There is a lot of support for this, but unfortunately, in these community meetings, it is completely lopsided because the people concerned about creating more jobs are usually working. As a developer, it gets discouraging because there is a lot of anti-development sentiment.”

Puna District

The planned location is shown above. It is on privately owned land, several miles away from the nearest population centers. PC: Alaska Aerospace, April 2019

Alaska Aerospace has plans to develop a spaceport in Kea‘au.

A public meeting was held at the Grand Naniloa Hotel on, Feb. 6, 2019, that addressed the proposed plans.

“The meeting was very useful and accomplished our intent: provide the community with information on the project and gather their feedback,” Alaska Aerospace President Mark Lester said. “We understand that commercial spaceports are new infrastructure and our future neighbors naturally have questions. Some people are quick supporters, others are simply curious about a commercial spaceport, while some are concerned it will impact their way of life. It is our hope that through continued discussion and understanding will allow both spaceport proponents and opponents will gain a better appreciation for the project and its value.”

The spaceport would launch rockets daily but CEO Craig Campbell said it will be no louder than the Hilo Airport. If Alaska Aerospace passes its environmental assessment, the spaceport could be operating in late 2020 or 2021.

The spaceport is only approximately 12.5 acres and consists of two launch pads—one for liquid-fueled vehicles and one for solid-fueled vehicles. PC: Alaska Aerospace, April 2019

Meridian Pacific Ltd. owns Puna Kai Shopping Center, which is nearly 100% leased.

Pāhoa residents welcomed the variety of new businesses, including Under the Bodhi Tree, Chef TK, Fitness Forever, Goodwill, Jeans Warehouse, L&L Drive-In, Maui Tacos, McDonald’s, Strato’s New York Pizzeria, Sushi Rolls and Bowls, UPS and Umekes Fishmarket Bar and Grill. The shopping center sits on nearly 10 acres. This $40-million project will provide 103,600 square feet of new business and retail space.

Ormat Technologies Inc., the parent company of Puna Geothermal Venture (PGV), which has been out of service since May of 2018 due to Kīlauea’s eruptions in the area, is in the works to rebuild. Considering PGV used to provide nearly one-quarter of Big Island’s electricity, the State of Hawai‘i and Hawai‘i Electric Light Company have committed to help in the endeavor. Recently, PGV has completed the access road to the site and mobilized workover rigs from the mainland. They have also completed drilling for a new freshwater well. However, they still need service power lines in order to test the company’s equipment. The power plant expects to be up and running again by the end of 2019.

Ka‘ū District

South Point Investment Group LLC has planned to build a lavish resort in Ka‘ū for more than a halfcentury now. The company has recently initiated a lawsuit against the Discovery Harbor Community Association for negatively affecting development plans. Plan discussions have included the possibility of two high-rise hotel towers along with restaurants, bars, offices, condominiums and other visitor lodgings. The land in question consists of two parcels (one just over 11 acres, the other about 18 acres) near Waiohinu at the center of Discovery Harbour.

Location of the Niumalu Marketplace as seen on a company brochure.

Kona District

Sentinel Real Estate Group and Blue Vista Capital Management are developing Niumalu Marketplace, a new 180,000-square-foot shopping center next to Lanihau Center, which will consist of 14 buildings on 20 acres made into Safeway, retail stores, restaurants and entertainment with parking for over 750 cars. The new shopping center plans to open in early 2020.

Kohala District

The new Town of Aina Lea is hoping to be constructed by the beginning of 2020. It would add more than 2,330 units, 385 of which would be considered affordable housing and 160 of which would be rental units.

The majority of those who testified at the Land Use Commission hearing showed strong support for the development of the urban land. The state, through State House Resolution (HR 204), also supported the development.

South Kohala is expecting a new agricultural community, Nakahili. The community will be on approximately 1,559 acres near the intersection of Māmalahoa Highway and Waikoloa Road. Nakahili consists of 700 one-acre agricultural lots surrounded by approximately 150 larger agricultural lots and the developer plans to include approximately 1,158 apartments and farm dwellings.

Tell us what you think about these development plans and any other Big Island developments in the comments section below.