MAKAHA — Five years after Schuyler "Lucky" Cole bought and renovated the long-shuttered Cornet building on Farrington Highway, he still hasn't found an anchor tenant and he wishes there were more retail shops.

But the fact that the Makaha Marketplace is open at all is notable considering it's in one of the island's most economically depressed locations.

"Nobody thought it would last this long," said Jo Jordan, a Wai'anae Coast Neighborhood Board member who also operates The Tax Lady tax preparation service in Wai'anae. "It's got an open-market feel. It's been really good for people who are starting up and getting their feet wet."

Most of the fewer than two dozen retail shop owners — who were given rock bottom rents and exceptional lease deals — say business has grown, if slowly, and that some new operations are planning to come in.

And on Oct. 29, for the first time, the seventh annual West Side Youth Festival will host its big Peace Exhibit and Haunted House in the parking lot from 11 a.m. to 9 p.m.

Westside Youth Festival founder Carol Pelekai said thousands are expected to show up for the Halloween festival, which will feature food and craft booths, games, prizes and giveaways in addition to the Youth Peace Exhibit and Haunted House.

"There will be a huge tent with a stage and all day entertainment," Pelekai said. "And from 12:30 until 5 p.m. there will be a Halloween Costume contest."

Pelekai said organizers decided to have the Halloween festival at the Makaha Marketplace this year because it's wide open, it's right across from the ocean, and because Cole has been a generous contributor to the organization.

Plus, she said there were difficulties when they held last year's festival at the Wai'anae Mall.

Reggie Robinson quit his job as a security guard three years ago to open a shave ice kiosk at the Makaha Marketplace. At the time he said there were only a handful of businesses, such as The Wash Spot laundry and Makaha Chop Suey eatery.

Now, a Subway sandwich shop is expected to arrive soon, and Affordable Gym is already in the process of moving in, he said.

"I look at it as sort of a business incubator thing," Robinson said. "I wanted to start a small business and I was willing to take a chance. And Lucky gave me a good deal. I signed a month-to-month lease. That's pretty much where we stand."

In addition to offering low-priced used items, The Treasure Box thrift store — which faces the ocean and operates on a month-to-month basis — serves as a sort of de facto community center, according to Tammy Withers, executive director of the nonprofit organization that runs the shop.

"This is a fun place — it's a gathering place," Withers said. "When people come in hurting, we listen to them. They can sit on the couch and relax. So, we can smile and talk with them, and there's a feeling of aloha."

Behind Robinson's kiosk the Paradise Isle Kama'aina & Visitor Center, occupying the front corner position, rents such items as surfboards and kayaks and sells Hawaiian collectibles and handmade jewelry.

Robinson says the two businesses help each other. His visible shave ice operation attracts customers to Paradise Isle, and vice versa.

"That's how the community grows," he said.

But it hasn't grown fast enough, according to Cole, who bought the 169,000-square foot lot for $1.5 million in 2000 and has put the property on the market for $8 million.

The building, at Farrington Highway and Makaha Valley Road, has 96,000 square feet. Cole says it's only about 25 percent occupied.

Mark Suiso, president of the Makaha Ahupua'a Community Association, believes Hawai'i's regulatory environment and the local community's misunderstanding and expectation of how businesses operate, is a big part of the problem.

"We've made it extremely difficult for employers to come in," he said. "At the same time, we have not done well in developing local entrepreneurs."

If the property were sold, Cole said the buyer would either have to accommodate the present lease agreements or buy them out.

And although there's no anchor business after all this time, Cole still believes that could change.

"It has taken substantially longer than I would have thought, but I remain optimistic," said Cole, who owns Team Real Estate in Hale'iwa, and who hoped the Makaha community would take a more active role in the building.

"Obviously, this wasn't the shrewdest investment in the world. It wasn't a bad investment. But, we're not a part of that community. We're not in a position to go in there and tell that community what it needs.

"We're kind of waiting for someone to come along and rent or buy space from us."

And that, says Jordan, is part of the problem. The property lacks development, she says. If that were to happen, she believes Makaha would support the right niche operations. The community could use a nice eating establishment, for example, or a small grocery store that specializes in fresh fruits and vegetables similar to those in Hale'iwa, she said.

She points out that the 7-Eleven across the street from Makaha Marketplace tore down its old store several years ago only to build a new building in the same place.

"That shows you there's money to be made out there," she said. "It's not just because everybody loves 7-Eleven."

Cole agrees that Makaha has exceptional potential. It's just that not enough folks seem to realize it.

"Just think, at any other state in the union, this Leeward Coast would be one of their featured resort destination areas," he said. "Yet here it's a homeless destination area.

"My view was if the Wai'anae Coast participates in the tourist industry a little bit, we will be one of the beneficiaries with our oceanfront location."

Reach Will Hoover at whoover@honoluluadvertiser.com.