North Shore development receives two-year permit extension

The developer of the North Shore Rural Community Commercial Center that is to be built across from Shark’s Cove has received a two-year extension to obtain its development permits by the Honolulu City Council.

Hanapohaku LLC plans to build a complex with 27,500 square feet of retail space, more than the neighboring 23,000-square-foot Foodland.

A sketch of the plan identified possible tenants as a couple of restaurants, a pharmacy, an urgent-care clinic, a copy and delivery shop, a yoga studio, a child care service, a gallery, a surf shop and other retail businesses.

Until the complex is built the property is being used primarily by food trucks.

Some community members and Councilmember Heidi Tsuneyoshi, who represents the area, are not pleased with the delay in building the retail center because they want the property to serve residents more than tourists, as its permits require.

Hanapohaku received a major special management area permit in 2018 to build the North Shore Rural Community Commercial Center. The special management area permit is needed for development near the ocean. After that permit is granted, a developer still needs additional building permits.

That special management area permit required Hanapohaku to obtain development permits within two years for the community project, but was extended by the city Department of Planning and Permitting for an additional year.

The City Council needed to approve any further postponement in obtaining development permits for the project, which the Council voted 7-2 in favor of Wednesday. The vote granted Hanapohaku an additional two years, until November 2023, to obtain development permits for the rural community commercial center. It was one year less than the developer’s original proposal.

Councilmembers Tsuneyoshi and Carol Fukunaga both voted against the measure.

Tsuneyoshi proposed allowing a one year extension, emphasizing the need for the rural community commercial center to replace the current commercial activities, most of which were food trucks, which she thought were mainly for tourists and not benefiting residents in the area.

“How much time are we going to allow the applicant to go on doing uses that are not fully vetted by the community, and was not a part of what was approved,” she asked.

DPP Director Dean Uchida suggested one year would likely not be enough time for Hanapohaku to obtain the development permits.

“They might be able to make it but it’s going to be really tight,” he said.

“So just to be cautious, we would recommend a two-year timeframe.”

Hanapohaku’s main reasons for seeking the extension were delays due to COVID-19 and a 2019 lawsuit against the developer and DPP over the SMA permits not receiving sufficient review, and not adequately enforcing violations in an area zoned to preserve North Shore’s rural character. The lawsuit was settled in February and limited the number of food trucks that would be allowed at the Rural Community Commercial Center from six to five, and would require Hanapohaku to install a new drainage system.

“Any knowledgeable and experienced developer knows that if you have a pending lawsuit challenging the very permit, that entitles you to build the project, you cannot proceed,” said Terrence Lee, the lawyer representing Hanapohaku.

“It’s very difficult to get prospective tenants to commit to a new lease until they have a better feel for how we’re going to recover from this pandemic. … I don’t think realistically a year will give us enough time to accomplish what we need to accomplish in order to line up the necessary tenants and the required financing to move forward.”

Lee also pushed back against the assertion that that the food truck operations currently happening on the property were not benefiting North Shore residents, pointing to the survival of the establishments during COVID-19 lockdowns when there were few tourists on the island.

“Do they enjoy a lot of business from tourists? I think that’s self-evident. But that isn’t because the nature of the business is targeted to tourists. It’s because Shark’s Cove is a popular destination spot for tourists,” he said.

“We all know there weren’t any tourists. And yet, these food truck operators, all five remained open, paid their rent, did not ask for any rent relief. And so they provided food to the local community. Who else were their customers?”

Tsuneyoshi emphasized that she is advocating for the Rural Community Commercial Center, but that she opposed the extension for the permits because it would likely mean that the development would also be postponed.

“I just want to make very clear that this is not against moving forward for the rural commercial center to be developed, it is very much for that,” she said.

“This is just a matter of trying to do the right thing for this very special area, and to ensure that moving forward … that all that’s supposed to happen there happens as soon as possible.”