The Hawaii agency charged with overseeing the redevelopment of the Honolulu neighborhood of Kakaako has shelved a proposal that would have created an economic accelerator in the former World Gym building on Queen Street.
At a Thursday special meeting, the Hawaii Community Development Authority denied the authorization of a memorandum of understanding for the project, which included the state agency paying for the lease for two years on behalf of the operator of the economic accelerator.
But at least one board member, Vice Chair Steven Scott, raised concerns over the HCDA paying up to $300,000 in rent over two years for the project without getting a return on its upfront payment.
Karl Fooks, president of the Hawaii Strategic Development Corp., which was spearheading the project along with three other state agencies, including the HCDA, said that tenants would be responsible for the rent after those two years.
The HSDC promotes economic development and diversification in the state through a return-driven investment program in partnership with private capital.
“Hawaii does need new sectors of growth,” he said. “These are the necessary infrastructure [efforts needed] to start attracting people to the urban area of development. It’s an investment in the future for Kakaako to be a place for people to live, work and play.”
Charles Wang, an entrepreneur who was a founder of RevoluSun and is now the CEO of EcoQoob, an energy audit startup, said that the economic accelerator would help attract more entrepreneurs like himself to the area.
“You need people to support the infrastructure in Kakaako,” he said. “[The project] would attract new innovation companies and would help us be competitive with cities like [Washington] D.C. and San Francisco. It would say a lot about what Honolulu and Hawaii can bring. That’s where I see the return [on investment].”
Luis Salaveria, director of the state Department of Business, Economic Development and Tourism, noted that the venture could have highlighted collaboration of state agencies that his department oversees.
In addition to the HCDA and HSDC, the other agencies involved include the High Technology Development Corp. and the Hawaii Housing and Finance & Development Corp., which is the landlord for the former World Gym building at 1050 Queen St., across from Ward Village.
The economic accelerator, which was first reported by PBN, would have allowed some of its startups to be able to transition to the commercial pipeline being developed in Kakaako.
Duane Shimogawa
Reporter
Pacific Business News