Office of Hawaiian Affairs justifies $47M purchase of commercial property in Iwilei
The Office of Hawaiian Affairs is justifying its recent purchase of two commercial properties in Iwilei on Oʻahu by saying revenue generated will benefit Native Hawaiians. But the money could also have been spent directly in the community or used to purchase culturally significant land in need of greater stewardship.
OHA recently bought two properties near Nimitz Highway for $47 million. One is a warehouse condo, and the other is a small shopping center that houses Ross Dress for Less, Longs/CVS Pharmacy, and PetSmart.
"This was an opportunity that was pretty rare. Not only was it an adjacent property to our headquarters, but it was already generating income with some nationally recognized tenants," said Casey Brown, OHA’s Chief Operating Officer.
Brown says the $1 million in annual revenue from the Iwilei properties could fund Native Hawaiian grant programs and community initiatives.
But why not use that $47 million to purchase culturally important lands or legacy lands?
"The money that we generate on our real estate holdings, we already carve out a nice segment of those funds to go to our legacy landholding. The portion of revenues that are applicable to legacy lands really come from our Kakaʻako Makai lands. By policy, we allocate about 50% of the net income that we generate to go to our legacy lands," he said.
Brown says there could be a similar policy for its new Iwilei properties.
Kalani Fronda, Director of OHA’s Land Assets Division, estimates the agency nets between $3 and $4 million a year from its commercial portfolio, a majority of which goes to fund its legacy landholdings such as the nearly 26,000-acre Waokele O Puna on Hawaiʻi Island and the more than 500-acre Kūkaniloko on Oʻahu.
"So we do have that appropriation that he mentioned, and that's how we budget accordingly to be able to support our operational expenditures that span across about 28,000 acres. So it's not a small portfolio, it's pretty large and it covers lands across the pae ʻāina," Fronda said.
OHA also owns revenue-generating properties in Kakaʻako along with its 5-acre headquarters on Nimitz Highway, adjacent to its most recent purchases.