Oahu’s only auto racing venue is expected to close now that a state judge has ruled that the raceway operator must vacate the land and return it to the Department of Hawaiian Home Lands.

DHHL and George Grace III, who owns Save Oahu’s Race Tracks LLC, have been in a long-running battle over the 38-acre parcel, which Grace has leased on a month-to-month basis for seven years as the site of Kalaeloa Raceway Park.

The state agency took Grace to court, claiming he owed more than $40,000 in delinquent rent and utility payments and violated other terms of the rental agreement. The city also has fined him and his company more than $240,000 for activities the city says were unauthorized but which Grace claimed were approved by DHHL. 

A judge ruled Tuesday that DHHL has the right to possess the property and ordered it to be returned.

"While we take no pleasure in having to remove a nonperforming, noncompliant permittee, we have to do what is best for our beneficiaries and our trust," Darrell Young, the department’s deputy director, said in a statement.

"It is truly unfortunate that this permittee chose not to work with our staff to become compliant with the terms and conditions of his agreement and to not pay the department the rent and utilities due over the past 18 months."

Grace’s company began packing up equipment at the raceway Tuesday, a company representative said.

She said the company is looking for another site and expects to discuss the possibility of using state land again — but not DHHL property — with a new administration after the election.

In a news release, the company said Gov. Neil Abercrombie and his administration have refused to work with the raceway to resolve the dispute.