It’s back.

Honey Bee USA Inc., the delinquent developer of the Waikiki Landing, a controversial public-private partnership at the Ala Wai Small Boat Harbor, has foiled the state’s endgame by filing for Chapter 11 bankruptcy relief.

The state Department of Land and Natural Resource’s Division of Boating and Ocean Recreation announced last week that it planned to cancel its lease agreement with Honey Bee effective Nov. 15 for nonpayment of more than $500,000 in back rent and a $1 million performance bond. The division said it was pulling the plug because the company also failed to provide the state with a viable majority investor and complete agreed-upon easements.

But Keith Kiuchi, president of Honey Bee USA, put everything back into limbo when he filed a voluntary petition for bankruptcy reorganization Nov. 13.

"A timely bankruptcy filing — which this appears to be — gives Honey Bee additional time to perform its obligations under the lease," said state Department of Land and Natural Resources spokeswoman Deborah Ward. "If Honey Bee is able timely to perform as allowed by bankruptcy law, then the lease will not be terminated."

Critics say they are frustrated that the gateway to Waikiki will remain marred by a muddy construction site and that boaters at the Ala Wai Small Boat Harbor will continue to lack access to a fuel dock and a boat repair facility, which were torn down to make way for the new development.

"Bankruptcies can take a long while. What a terrible situation the state of Hawaii has gotten itself into," said Waikiki Neighborhood Board member Bill Lofquist. "This is a debacle, and I don’t see when we will be able to straighten it out. Time is against us. We are in trouble. I’m sorry to say that this is a lose-lose for everyone."

Lofquist and other residents say they are frustrated because the state’s partnership with Honey Bee goes back to 2009, and still nothing has been built.

The project, which was conceived with much hype under Gov. Linda Lingle’s administration, was originally intended as a model for public-private partnerships that would provide taxpayers with needed services without draining state coffers. The project had been touted as having the potential to generate more than $900,000 a year for the state and more than $200,000 in annual city property taxes.

New city zoning and state legislation paved the way for the planned complex, which has been fraught with financial and bureaucratic difficulties. For starters, it took the state and Honey Bee several years to work out a 65-year lease, which commenced Jan. 1, 2014, for an annual minimum base rent of $821,652 per year, with periodic rent increases through the first 30 years.

Community dissent and changes also delayed the project and substantially increased costs. According to a 2010 draft environmental assessment, Honey Bee originally planned to spend $9.7 million constructing two buildings that would put two wedding chapels at the harbor, add commercial space and replace an existing fuel dock, convenience store and a boat repair business. That plan met with opposition from surrounding Waikiki residential and boating communities and the Waikiki Neighborhood Board, which sought more businesses dedicated to improved boating facilities and services.

The developer introduced several mixed-use concepts before finally settling on one in 2012 that more than doubled the original cost. The current three-building plan, which includes 44,153 square feet of leasable space and a 17,000-square-foot boat repair dock with parking, increased development costs to about $35 million.

The project took another hit when Kyoto-based Hideaki Shimakura ended his role as the project’s major financier in July 2014. Kiuchi, who was originally the project’s legal counsel and a minority investor before becoming president, soon found himself scrambling to find a majority investor to save the project. Kiuchi proposed five new sources of funding, including the latest from Utah-based ICON Commercial Lending; however, staff with the state Division of Boating and Ocean Recreation say that none ever came to fruition.

The division finally took definitive action after Honey Bee failed to meet deadlines imposed by the state Board of Land and Natural Resources, which had given the company three reprieves since March. The state said that action meant they could finally move forward in seeking a new development partner for a project that was anticipated to open in December after years of starts and stops.

Kiuchi’s bankruptcy filing means that a judge, not the state, will determine the lease agreement’s future. Honey Bee also has removed the state’s ability to vet its lending partner by negotiating a lesser equity position with ICON, a company that Division of Boating and Ocean Recreation staff viewed as unsuitable.

"The bankruptcy proceedings give Honey Bee time to get out of debt and to secure funding from ICON," said Dale Rak, a Honey Bee consultant. "ICON has had a number of delays, but we anticipate that they will be able to fund in the next two to three weeks. The state can’t reject ICON because their ownership level doesn’t hit the majority threshold."

At one time ICON was expected to contribute $35 million for a 50 percent equity position. The company’s most recent agreement with Honey Bee is to supply a first-phase contribution of $12 million for 19 percent ownership.

Kiuchi has hired attorney Chuck Choi to represent Honey Bee in the bankruptcy proceedings. In his voluntary bankruptcy petition, Kiuchi estimated that the corporation has fewer than 49 creditors. Honey Bee owes the largest debts to the state, which has $562,932 in unpaid rent claims, and Choate Construction, which is owed $529,730. Other major debts include Attend Service Inc. for $476,724, Hawaiian Dredging Construction for $473,861, Tutu USA for $438,544, Thomas Enomoto for $265,665, RM Towill Corp. for $236,763 and Kiuchi for $214,637.

"The state will pursue back rent to the full extent allowed by the law," Ward said. "The state does not anticipate that it will have to expend significant money to close or secure the leased property."

According to the bankruptcy filing, Kiuchi’s estimated assets are between $10 million and $50 million, while liabilities are expected to fall between $1 million and $10 million. As the company’s responsible individual, Kiuchi will be in charge of performing the duties of the company in the proposed Chapter 11 case, including taking the actions necessary to restructure the company’s financial affairs.

"This is another example of the state not knowing what the hell it’s doing — it’s a common denominator. They just don’t seem to get it," said Bruce Lenkeit, a Waikiki boater who lives near Honey Bee’s stalled construction site. "The former administration’s goal to upgrade the Ala Wai Harbor into a world-class facility turned into a lost decade creating unnecessary hardships or hassles to lug jerrycans of fuel or get supplies for maintenance, wasting precious time and money in traffic, in order to go fishing or have fun on the ocean."

Lofquist and Lenkeit are among the vocal contingent who want to see the state’s failed experiment with Honey Bee come to a swift end. However, state Rep. Tom Brower (D, Ala Moana-Waikiki) said taxpayers would benefit more if the bankruptcy reorganization leads to a viable project.

"If this falls through, we’ll have to wait a very long time until something else happens," Brower said. "I kind of hope the current project doesn’t fall through. The community had some initial concerns, but many supported it in the end and it’s a low-rise. For these reasons, I think the community should support the current project and be patient."