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The Honolulu Advertiser
Posted on: Monday, December 22, 2008

Oahu landowners bracing for rail

By Peter Boylan
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser
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To build Honolulu's planned $5.3 billion commuter rail line, the city must acquire all or part of more than 180 private properties.

The city, which budgeted $70 million to buy the land, intends to offer owners fair market value based on an appraisal. But not all property owners are convinced they will be fairly compensated.

"How much are they going to pay?" asked Florante S. Sebastian, owner of a commercial building at 1901 Dillingham Blvd. that may be bought by the city.

Sebastian said his building — which is home to a mortgage business, Dillingham Cafe and a beauty salon — is worth $2.1 million. But he said that price won't account for the lost business and rent he receives.

"We're making good money, so I need fair market value or better," he said. "The value of my property is $2.1 million and I want to have that at least, but I would need more because I would be losing my business. I would have to calculate how much business I would lose for the rest of my life."

Mayor Mufi Hannemann said the city is working to assure landowners they will get fair value for their property.

"There is always going to be anxiety, which we understand. We're going to be sensitive," the mayor said.

Hannemann hopes to begin construction late next year on the 20-mile system linking East Kapolei to Ala Moana, with parts of the line opening in phases between 2013 and 2019.

In an attempt to minimize the project's land requirements, the city plans to build the elevated, approximately 26-foot-wide guideway within existing street rights of way and on government-owned land. However, the guideway and its 50-foot-wide stations will still require acquiring some private lots.

The city is considering two possible rail routes. Under current plans, if the train travels on a route through Salt Lake, the city needs to acquire — fully or partially — 193 properties. An airport-area route would affect 182 properties. Both routes would displace 20 homes, most of them in an area near the H-1/H-2 merge known as the Banana Patch.

The location of properties that could be affected has been available on the city's Web site for about two years. An updated version, which can be viewed at www.honoluluadvertiser.com, is included in the project's recently released draft environmental impact statement. That document, which is still subject to change, includes several changes from the prior plan.

That's the case with a parcel under a Kalihi 7-Eleven store at the corner of Dillingham Boulevard and Mokauea Street near Sebastian's property. Under prior plans, the city was considering taking 36 feet of that property's Dillingham Boulevard frontage. Now the city is considering taking the entire 9,214 square-foot property.

The city's plans are likely to affect lease renegotiations with 7-Eleven scheduled to occur next year, said property owner Michael Kam.

"Obviously that's going to throw a monkey wrench into our plans," he said.

Kam said he has not yet had a chance to meet with city officials, who have notified him the city may need the land.

"We would definitely be against taking the entire property," he said. However, he added, "We also own property on Dillingham further diamondhead of the 7-Eleven location, so the good thing is it might make that property more valuable."

Fighting the city on property condemnation wouldn't be easy. That's because mass transit serves a public purpose.

Buzzy Okazaki said he won't oppose the city, which wants to acquire his 12,056-square-foot parcel in Waipahu near Farrington Highway and Mokuola Street. Okazaki's lot, which is leased to a car dealer, and a car lot under separate ownership across the street are targeted for full acquisition by the city.

"I'm not going to fight it," Okazaki said. "All I'm doing is negotiating with them on the value of the property.

"I'm resigned to this takeover. I can always get another property somewhere — it's not a big thing."

Final right-of-way requirements could still change until the project's design is finalized in 2010, according to city officials.

The property acquisition process won't begin until the federal government approves the environmental impact statement, which city officials hope will occur in fall 2009. The city plans to begin construction on the first phase, which would connect East Kapolei to Waipahu or Leeward Community College, in December 2009.

One of the main reasons for starting construction on the 'Ewa end is that the city thinks it can acquire the land in that section relatively easily, at least compared with land elsewhere along the line.

Once the acquisition process starts, the city said, it will determine fair market value for properties and offer owners that much. If they refuse to sell, the city may condemn the property.

Property owners, business owners and the city may battle over what constitutes fair value — and that will hinge on when assessments are made. Businesses that could be displaced include Dee Lite Bakery in Kalihi and the Aku Bone Lounge & Grill in Kaka'ako.

Kristine Altwies, who runs Hawaii International Child Inc., an international adoption agency on Waimanu Street, said she is planning to move because her landlord will be forced to sell.

"It's literally coming through our board room. I do hope the city gives these folks (the landowners) a good deal; this is the hottest neighborhood on the island right now," Altwies said.

"I think whether you're for or against rail, this sort of thing happens. It's life, and when you're a small business, part of your business plan and strategy has to be flexibility. If the planners have figured out that this is the best route, even if we're a minor tragedy in that, I don't think it's that big a deal."

Advertiser staff writer Sean Hao contributed to this story. Reach Peter Boylan at 535-8110 or pboylan@honoluluadvertiser.com.

Reach Peter Boylan at pboylan@honoluluadvertiser.com.

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