The state Department of Accounting and General Services has pledged to help the Hawai‘i Tourism Authority through a leadership change that put $100 million worth of Hawai‘i Convention Center repairs at risk.
But it’s unclear if DAGS will be able to meet the planned two-year timeline and avert millions of dollars in lost group business. While state Comptroller Keith Regan told the HTA board May 28 that DAGS would take on the project, he advised that the timetable was “very aggressive.”
Teri Orton, general manager of the Hawai‘i Convention Center, expressed concern that the center’s repair timeline previously was extended from 2026 to 2027, and that DAGS already is anticipating that delays could extend beyond the center’s modified two-year closure.
“We cannot delay this project and relocate or lose more business,” she said. “There needs to be a sense of urgency.”
Orton told the Honolulu Star-Advertiser Wednesday that she has been in contact with HTA and DAGS, and “it’s too premature currently to comment on where our rooftop project is going to end up. It currently is with HTA and we are talking about having DAGS manage this for us, but they are very busy with the Aloha Stadium and other projects.”
Orton said the center’s worries about the construction timetable materialized after Isaac Choy, HTA vice president of finance and acting chief administrative officer, who had been running point on the project, was placed on unpaid leave in May amid allegations he made racist and sexist remarks on the job.
Choy, a former state tax director and five-term lawmaker, has vehemently denied the allegations, calling them false and retaliatory.
Orton said Choy’s absence “has us reassessing options to continue to keep this project moving along.”
At the May 28 HTA board meeting, Regan, who formerly worked as HTA’s chief administrative officer, said he has “pretty strong familiarity with this particular project,” since he worked on it prior to his departure.
“We are happy to be of assistance to the HTA and the convention center to help move this project along and make sure we do our best to keep the timeline that has been established,” he said.
Regan told the HTA board he planned to personally “carry the water” on the project with his staff.
HTA board member Stephanie Iona said having Regan personally committed to the project was reassuring, along with his report that “DAGS has always been a support of the state-owned convention center.”
But Regan’s pledge came with a caveat.
“It’s a very aggressive timeline that’s been put out. We recognize the need to be aggressive. We also recognize the economic impact that the closure of the convention center will have on the state,” he said. “It’s a high priority for us to be able to move as quickly as we can, but with the understanding that we are a state agency and we are beholden to certain procurement recruitments as well as contracting requirements, and as such, I just wanted to caution that there may be a need to revisit the schedule.
“But we’ll cross that bridge when we get there.”
HTA board member David Arakawa, chair of the agency’s Budget, Finance and Convention Center Standing Committee, noted at the May 28 meeting that DAGS also is in charge of the Aloha Stadium redevelopment and the state Capitol ponds project.
Regan acknowledged “we have a large number of major projects that are on our plate.”
DAGS has about 400 ongoing projects statewide between stages of planning, design or construction, according to the agency’s Public Works Administrator Gordon Wood.
Arakawa advised Regan the committee at its next meeting would be asking him about the priority of projects. “We’d like to know that because it was No. 1 for the prior project manager,” he said.
In the meantime, Orton said the center is still in the process of accommodating 2027 group clients.
“No business was lost for 2026; those groups moved to future years or self- contained at the headquarter hotels, which is great news,” she said, adding that 2027 had more business on the books, making it more complicated.
One huge loss is the Rotary International Convention, which Honolulu had planned to host June 5-9, 2027, and could not be moved to other venues in Hawaii because of its size or to future years due to timing. The value of Rotary was estimated at more than $35 million based on estimates from its 2020 convention, which was canceled due to the COVID-19 pandemic.
During the closures, Orton said the convention center will run on a “modified event schedule and will continue to host events during nonconstruction hours and in space not being impacted by the repairs.”
Even with the delays, she said, “HTA is committed to keeping all staff during our construction as we are not 100% closed. All festivals, sporting events, and local events and meetings that can take place during nonconstruction hours will still be hosted at the center.”
Keith Vieira, principal of KV &Associates, Hospitality Advisors, said group business is an important segment of Hawaii’s tourism industry and needs to grow.
“The groups book ahead so they help create a base of business that allows us to build demand and leverage rates,” Vieira said. “Group travelers also tend to spend more and make pre- or post trips to the neighbor islands. They tend to move as a group and stay in resort areas, so they are the ideal high-spending, lower-impact travelers to Hawaii.”
Joshua Hargrove, general manager of The Westin Maui Resort &Spa, said Oahu hotels already are grappling with the sluggish recovery of the Japan market and an extended convention center closure also will reduce occupancy, which has a negative trickle-down impact across the state.
“The Oahu hotels need to be viable so they’ll adjust rates (down) and try to attract from other islands, and then the islands begin to compete against themselves. No one really wins when this happens,” he said. “All the islands need to be succeeding and thriving, which translates to jobs and (gains) for other businesses that rely on tourism.”
Jerry Gibson, president of the Hawai‘i Hotel Alliance, said an extended closure is serious because of the “millions in lost revenue that it will bring,” but also because of the damage it could do to the convention center’s reputation.
“We gave our word,” Gibson said.
