Business owners concerned over rail property takeover

By Tim Sakahara - bio | email

HONOLULU (HawaiiNewsNow) - The Makana Esthetics Wellness Academy is a calm relaxing spa, but the owner is feeling a bit panicked by the train heading her way.

"All we know is that we're in the path and we're going to have to leave someday when we're told," said Malia Sanchez, Makana Esthetics Wellness Academy, which trains students to be licensed estheticians and also offers spa services.

When they moved into the Kakaako location on Waimanu Street it needed a lot of work to make it but with time and money they turned it into a tranquil spa.  Although they still owe more than $200,000 in renovation costs.

"It's a scary feeling because it's money we did not get a return on yet as far as our investment," said Sanchez.

A year after opening in 2007 they learned the train was coming right over them.  Worse yet they are not the landowner and the city won't contact tenants to let them know what's going on, unless they get permission from the landlord.

"The government is under no obligation to pay separate value for the lease rights," said Robert Thomas, Property Rights Attorney.

Thomas is working with a handful of people who will be caught up in the property takeover.  He says unless tenants have a condemnation clause in their lease, they won't get compensation from the property owner's offer from the city.

However under federal guidelines a qualified business could get "actual, reasonable and necessary" moving expenses reimbursed.  They can also get up to $2,500 to help find a new location and up to $10,000 to re-establish itself at the new location.

"You think you own your property but can you think of another situation where the government can say we know you don't want to sell but we're going to force you to sell your land to us and here's the price we'll offer you and if you want any more you have to sue us. Wow that's pretty stunning stuff," said Thomas.

"It's hard to put a value on. It took us this long to get our clients here into the spa. It takes some time to build up a reputation and just finding our place and we'll be starting all over again," said Sanchez.

There are less than 200 properties that will have some or all of their land taken over to make way for rail.  So far the city has made 15 offers to property owners.  All but one has been accepted.  The appraisals continue as the city is in the process of making 21 more offers now.

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