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Tuesday, February 8, 2000

Home Depot
targeting Hawaii Kai

Kamehameha Schools is
negotiating with the big-box
retailer to sell a 43-acre parcel

By Rick Daysog


Art Kamehameha Schools is looking to sell a 43-acre Hawaii Kai parcel to Home Depot Inc., in the latest twist to the local retail development wars.

The $6 billion estate's board of trustees recently approved a staff report recommending the sale of its fee interest in the property, which is the site of a long-stalled luxury condominium project known as The Peninsula at Hawaii Kai, sources familiar with the deal said.

The terms of the proposed transaction were not available.

A Kamehameha Schools spokesman was not available for comment. Home Depot spokeswoman Carol Schumacher said she could not confirm or deny a Hawaii Kai deal. But she added that the company is always looking for new properties.

Atlanta-based Home Depot, the nation's largest home improvement retailer, operates a 145,000-square-foot store in Iwilei and plans to open a second store in Pearl City.

Given the size of the Hawaii Kai property, Home Depot could develop a shopping center to go with a full-sized hardware store, real estate experts said.

The proposed Home Depot store would compete with the Costco and City Mill Home Improvement Center at the nearby Hawaii Kai Towne Center, which is owned by a Kamehameha Schools unit.

It also comes at a time when other big box retailers are looking to expand on Oahu.

Wal-Mart Stores Inc. is purchasing an 8.5-acre parcel on Keeaumoku Street near Ala Moana Center while Costco is planning to open its third Oahu warehouse store at Gentry Business Park in Leeward Oahu.

The Hawaii Kai property is zoned for residential use, which means that Home Depot would have to get City Council approval to change the zoning for commercial uses.

The property previously was owned in leasehold form by Japan-based Nansay Hawaii Inc. During the early 1990s, Nansay planned to build a large upscale project, which would have included 324 condominium units and 280 townhomes. But the project stalled as the local economy went south, forcing Nansay to give the property back to Kamehameha Schools. Established in 1884, the Kamehameha Schools is one of the nation's wealthiest charitable trusts and is the state's largest private landowner with over 360,000 acres in Hawaii.

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