HILO, Hawai'i — KTA Super Stores is reconsidering plans to renovate its downtown Hilo grocery store and remove an adjacent building, a senior company executive said Monday.

Difficulty getting Hawai'i County approvals, the recession and some unforeseen operational expenses have all combined to delay the project, said Andrew Chun, KTA vice president of administrative services.

"It's creating some cost overruns," Chun said of the combination of factors preventing the planned renovation of the store on the corner of Keawe and Mamo streets.

Chun said all options are now being evaluated, noting the project's original $500,000 price tag has ballooned to an estimated $1.8 million.

"Most likely we'll have to scale it back," he said, adding the goal is to keep the project's cost below $1 million.

A decision is expected in a month or two, he said.

KTA received a special management area, or SMA, permit in January. The permit is needed to build near the ocean.

Next, a demolition permit was obtained to remove the two-story, 7,700-square-foot building located adjacent to the grocery store. That building, constructed in 1914-15, has largely been vacated and is barely standing due to prolonged water and termite damage.

Chun acknowledged the liability risk caused by the sagging, leaking roof that extends out over the sidewalk. Still, he must wait for the necessary approvals before the project's next phase can be undertaken.

"We haven't gotten our (building) permit yet," Chun said.

Barry Taniguchi, company president, said in July that piecemeal construction is unacceptable.

"I don't want to demolish and leave it ugly," he said. "I wanted to fix it up at the same time."