The billionaire who owns nearly all of Lanai is moving forward with another piece of a broad plan to diversify the economy on the island where luxury tourism reigns.
Larry Ellison, the Oracle Corp. founder who bought nearly 98% of
Hawaii’s sixth-largest island in 2012,
is seeking approvals to establish a
200-acre industrial park through his firm Pulama Lana‘i.
Pulama recently informed the state Land Use Commission that it intends to ask the agency to reclassify
200 acres next to Lanai Airport from agricultural to urban use for its proposed Miki Basin Industrial Park.
The envisioned $340 million project, which Pulama expects to develop
incrementally over
30 years, represents what appears to be the first move to significantly
expand the urban footprint on
Lanai under a long-term Pulama
vision.
A core piece of this vision calls for adding 546 acres to triple the size of Lanai City to accommodate more housing, a university campus, film
studios and a tennis academy in the
island’s center, where residents and businesses are concentrated.
Other pieces of the vision include expanding the airport and adding
105 acres of primarily residential development mauka of the Manele resort area along the island’s southern shore.
Under Pulama’s conceptual plan, the island’s population of a little over 3,000 in recent years could grow to about 6,000 by 2030 if the company
realizes its vision to expand and
diversify the Lanai economy, which has depended on one industry —
first pineapple farming on about
15,000 acres and then tourism anchored by two luxury hotels — for nearly a century.
Ellison, who is chairman and chief technology officer of software maker Oracle and is ranked by Forbes as the world’s seventh-richest person with
a net worth of $64 billion, has said he wants to make Lanai a more sustainable community.
Since he bought the island from
Castle &Cooke Inc.’s billionaire owner David Murdock for a reported
$300 million, Ellison’s first huge investment was a $75 million renovation of the former Manele Bay Hotel, which
reopened as the Four Seasons Resort Lanai in 2016 with nightly rates
starting at $950.
Through Pulama, Ellison also is spending roughly
$75 million to convert the other luxury hotel on the
island, the Lodge at Koele
in Lanai City, into a wellness retreat also managed by Four Seasons. It’s slated to open later this year.
Community improvement projects by Pulama have included restoring historic buildings, environmental
remediation and reopening the community pool.
Ellison also has been working for the past two years on establishing
a hydroponic farm that would use an automated, computer-driven greenhouse system to grow
exceptionally nutritious
produce that can be sold
in local markets for less
than imports.
Details of the industrial park plan were laid out in
a draft environmental assessment Pulama submitted to the LUC for reference last month.
In the report, Pulama said there isn’t any space for more industrial businesses at the two existing industrial areas on Lanai near the airport and at Kaumalapau Harbor.
“Based on expected
economic and population growth over the next
30 years, there will be a need for industrial-zoned lands on the island of Lanai as there is none available at the present time,” the report said.
The report also said the proposed industrial park would allow existing industrial facilities that are “inappropriately” scattered in Lanai City to move to a more appropriate location.
Pulama estimated that building the park would generate 28 jobs a year on average over 30 years and that businesses in a fully developed park would employ 360 people.
Developing the park would involve Pulama
constructing infrastructure and either selling or leasing lots to users or developers. Pulama estimated that all lots could be sold for
$105 million.
Permitting the industrial park, which would require a zoning change from Maui County, isn’t expected to be controversial because the project’s concept was incorporated into a 2016 update of the Lanai Community Plan approved by the Maui County Council after much public input and hearings
by the Lanai Planning
Commission.
The Lanai Community Plan helps guide land use and other policies for the
island, and many elements of Pulama’s vision were proposed for inclusion in the document.
One controversial project desired by Pulama that got cut from the community plan was a bungalow-style hotel with 100 rooms, two beach parks and a rural subdivision with up to 50 homes on Lanai’s eastern shore.
Another piece of Pulama’s plan, a desalination plant
to produce potable water, stalled a few years ago over how long such a facility should be permitted.
Fresh water on Lanai is
a critical issue because the island’s underground aquifer is relatively small and could be drained by a lot
of new demand.
The planned industrial park initially would draw water from the available supply, but its projected
average daily need for
1.3 million gallons at full build-out would push the limits of what’s available,
according to Pulama’s filing with the LUC.
Pulama stated that Lanai’s sustainable water yield is
6 million gallons daily, of which 3 million gallons is from a leeward aquifer where average use has been about 1.6 million gallons daily over the last year.
“Initial development of the Miki Basin Industrial Park can be accommodated with the existing (leeward system),” the filing said. “However, an additional new water source or sources will have to be developed to support full build-out of the project.”
Pulama noted in its report that recycling wastewater for irrigation could be an
operation served by the
industrial park. Other
potential uses of industrial space mentioned include warehouses, fleet base yards, food distribution, auto repair, construction services, manufacturing
and storage.
