HONOLULU (HawaiiNewsNow) - One of Kaka'ako's largest landowners is asking the Honolulu Authority for Rapid Transportation to pay more than $200 million for land the agency still needs to acquire in the area – a price tag $186 million more than the city's most recent offer.
City Councilmember Joey Manahan told Hawaii News Now on Friday that rail authority members believe the land in question is worth $14 million. Because of the price discrepancy, HART is now seeking to condemn more than a dozen parcels owned by the Howard Hughes Corporation.
Manahan says the agency is willing to let a judge decide a fair price for the land because the Howard Hughes' asking price would push the $8 billion dollar project even further over budget.
"To put this into perspective, the original estimate to finish the remainder of the (rail) project is $550 million," said Manahan.
Manahan also argued that Hughes properties will benefit greatly from the rail running through an area filled with their new highrises and retail developments.
"There's tremendous benefit to them to have the stations there, not only for them to build more housing, but also their commercial spaces that will benefit greatly," he said.
The Howard Hughes Corporation had no immediate comment, but under Hawaii law, they're entitled to the fair market value – a value which has soared in recent years.
"We are in the cycle. We are going to expect higher prices," said real estate expert Ricky Cassiday.
Cassiday says the dispute is an outgrowth of the overheated market. Had HART purchased the land two years ago, he adds, the costs would have been a lot less.
At the time, the rail agency was under extreme pressure to find money for its persistent shortfalls.
"The more that you build in this high-cost environment, the higher the cost for the taxpayer in terms of the rail," he said.
Condemnation proceedings typically take about two years. Manahan says he hopes the city and the landowner can reach an agreement before then.