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By Dane Stein. December 12, 2012 - 9:27 am
The governing board of Aloha Tower Marketplace will allow HPU to continue with its plan to revitalize the ailing retail space with university facilities and lofts to accommodate 320 students and has passed zoning changes unanimously.
Aloha Tower Development Corporation passed the change in administrative move in a step that takes the historic site one step closer to the $32 million dollar facelift that is proposed by HPU and developer Ed Bushor’s company Hawai’i Lifestyle Retail Properties, LLC.
$120 million in tax-free special purpose revenue bonds were passed by the Hawai’i State Legislature with House Bill 2248 and signed by Gov. Neil Abercrombie in July.
However, the bill stipulates that only non-profit usage is allowed should sale of the bonds be allowed to proceed and finance be provided tax-free. For this reason, the university is seeking to take over management of the property from Bushor.
The university owns an 80% majority, while Bushor’s company still controls the remaining 20%.
In reference to buying out Bushor’s company interest, Todd Simmons, Vice-President of Marketing and Communication, said in an interview with Hawai’i News Now that “There are, I think, some fairly routine matters that need to be worked out with regard to management and development.”
Full ownership of the site by HPU is key for two main reasons: the sale of the Special Purpose Revenue bonds might not be allowed to proceed if a for-profit partner still holds interests, and usage of the bonds would save the University a reported $60 million in debt payment costs over 30 years, according to HPU Vice President and General Counsel Janet Kloenhamer.
The proposed redevelopment of Aloha Tower would not only include the student lofts, but also have room for Business school facilities, and a sports and entertainment complex which has been called the Aloha Cultural Theatre.
Business owners have expressed enthusiasm at the idea of HPU students moving into the space, which suffers from 70% vacancy.
Despite the administrative hurtles to come, Kloenhamer said in an article in the Honolulu Star-Advertiser that the issue is resolvable. Bushor said that he wants to see the plan succeed, and benefit the university and the state.