State agency set to take over Aloha Stadium redevelopment

A state agency primarily focused on facilitating redevelopment in Kakaako is preparing to assume leadership of the effort to replace Aloha Stadium.

Board members of the Hawaii Community Development Authority endorsed a draft memorandum of understanding last week for acting as the “delivery agency” for the stadium project, which has been in a conceptual and planning phase for several years driven by the state Department of Accounting and General Services and the Aloha Stadium Authority.

Gov. David Ige in July signed a bill into law as Act 268 instructing HCDA to take a handoff from the two other entities and use its redevelopment powers to replace the old stadium on state land with a new one plus other surrounding uses on the 99-acre site in Halawa.

The stadium redevelopment project, which got rolling around 2014 with assessment studies and earlier this year received a $350 million funding commitment from the Legislature, is now on a relative fast track because building a new stadium sooner means spending less money on the existing stadium, which opened in 1975 and is plagued by severe rust and other problems.

State officials want to have a new stadium with around 35,000 seats open by fall 2023, and project it would cost far more — $420 million — to maintain the existing 50,000-seat stadium for another 20 years than to build and operate a new stadium.

HCDA is now the “implementation arm of the realization of the stadium district,” said Aedward Los Banos, HCDA executive director.

DAGS, with assistance from a consultant, has been working on an environmental impact statement and expects to issue a request by January for qualifications from developers wanting to build the new stadium.

From there, HCDA would step in to issue a request for development proposals and be the agency that picks a winning submission after considering input from the Stadium Authority.

HCDA, which has 17 board members tasked with making decisions on stadium redevelopment proposals, is being encouraged to be ready with its proposal solicitation by March.

A couple of HCDA board members, Jason Okuhama and Robert Yu, questioned whether such a timetable is realistic.

“Are we ready for the RFP?” asked Yu, deputy director of the state Department of Budget and Finance. “It’s three months from now. Forget December.”

Los Banos suggested the goal is doable and that a winning submission could be selected by the end of 2020.

Having a private developer finance, design, build and maintain the new stadium, which the state would pay to use, can reduce the development expense for taxpayers, Los Banos said.

Lawmakers selected HCDA in part because of its experience with improving parts of Kakaako permeated by urban decay for decades because of inadequate traditional government investment in roads, sewer systems and other infrastructure.

The agency has invested in such infrastructure with private landowner assistance and provided regulatory incentives for developers to improve private property in Kakaako largely with high-rise housing. HCDA also has worked with private developers on projects using state land in the area, including new affordable rental housing, improving the Kewalo Basin commercial boat harbor and creating a high-tech business incubation center.

However, the agency also has failed in past decades at realizing some major redevelopment plans for state land in Kakaako makai of Ala Moana Boulevard.

To carry out the stadium redevelopment project, HCDA wants to expand its staff with a senior project manager, a senior staff planner, an accountant and a clerical support worker.

Besides handling stadium replacement work, HCDA expects to solicit development proposals for other parts of the state’s 99-acre site around the new stadium under ground leases for up to 99 years.

The agency could help develop infrastructure to support this supplemental development envisioned to include retail, housing, hotel and other uses. These projects could be done through similar private development arrangements and help offset the expense of the new stadium.

Los Banos said completing this secondary phase of development around a new stadium could take 20 to 30 years.

HCDA has been instructed under Act 268 to adhere to transit-oriented development, or TOD, zoning rules drafted by the city for the stadium area, though the agency could override these zoning limitations with approval from the governor.

The TOD plan, which has yet to be finalized by the City Council, was created because a city rail station is planned next to the stadium. This zoning allows buildings up to 250 feet tall on the stadium property and envisions there could be as much as 3 million square feet of new development, including 2,000 homes, 250,000 square feet of retail and restaurants, 300 hotel rooms, 400,000 square feet of office space and 100,000 square feet for entertainment and cultural uses.