The Hawaii Community Development Authority authorized a lease agreement with Ward Village on Friday for the operation and management of Kewale Basin Harbor on Oahu's south shore.
The state's only commercial small boat harbor will be transformed through this public-private partnership in the Kaka'ako Community Development District.
The Howard Hughes Corporation is the company behind Ward Village.
The underused harbor, which currently has 144 slips in various states of disrepair, has long been in need of a comprehensive overhaul. Now, Ward Village has committed to undertake millions of dollars worth of improvements as outlined in a plan and Environmental Impact Statement drafted in 2010. The planned upgrades will transform Kewalo Basin, at no cost to Hawaii taxpayers, and will benefit area fishermen, boaters, and other harbor users.
The HCDA's vision for the harbor, as described in the 2010 Kewalo Basin Harbor Improvement EIS, is to create a unique community amenity where Oahu's residents will gather to take advantage of open space, great surf and new and existing businesses along Honolulu's shoreline.
Ward Village says it is committed to helping the long-standing fishing charters and recreational ocean businesses that utilize the harbor by creating a public waterfront gathering space for everyone to enjoy.
"Effective harbor renovations are never cheap or easy, and we recognize Ward Village for stepping up and investing in the future of Kewalo Basin Harbor," said Brian Lee, chairman of the HCDA. "This lease agreement will allow us to share both the risks and the returns in revitalizing the harbor to serve the community. We will be working together to reconnect Kaka'ako and all of Honolulu with our waterfront."
Ward Village will manage the harbor in conformity with all existing harbor rules, while providing tenants with the operational benefits of its mixed-used neighborhood, located just mauka of the harbor.
The lease term will be for up to 35 years with a 10-year option to extend. It will include payments to the HCDA, which will be used for the continued support and maintenance of public facilities and further community improvements in Kaka'ako.
These payments include a lease premium, annual base rent for the maximum 35-year term, and percentage rent after a natural break point. The lease is expected to be executed and take effect in mid-August.