Foundation takes over marketplace

By Rick Daysog
Star-Bulletin

The Queen Emma Foundation has taken over the International Market Place, in a move that consolidates the foundation's Waikiki properties.

The federal bankruptcy court in Dallas approved the transfer of the 125,000-square-foot marketplace to the foundation on Tuesday, settling a heated lease dispute with the property's lessee, WDC Venture. WDC filed for Chapter 11 bankruptcy protection in 1996 after its rents were set to skyrocket under a 1995 arbitration panel's appraisal.

The foundation, part of the Queen's Health System, said it has no immediate operational changes at the International Market Place. It said the real estate firm Graham Murata Russell will remain as the parcel's managing agent.

Kennedy said the foundation has not looked into the long-term use of the marketplace. Located on Kalakaua Avenue, the marketplace is home to scores of small retailers and restaurants that operate on a month-to-month basis.

In 1988, state lawmakers picked the marketplace for the proposed state convention center, setting off a near-riot by merchants who would have been displaced. The convention center has since been built at the old Aloha Motors site.

The foundation is a major landlord in Waikiki, owning the fee or leasehold interest in nearly 19 acres of Waikiki land. It acquired the adjacent Waikiki Town Center for $21.2 million in December. The foundation also owns the 10,000 acres of land on the Big Island and about 2,000 acres in central Oahu.

Andrew Beaman, WDC's attorney, said the settlement allows the company to complete its reorganization and emerge from bankruptcy protection.

Under its previous lease, WDC had been paying an annual rent of about $187,000, but that would have increase substantially after arbitrators appraised the land at $58 million in 1995, Beaman said.