Hawaii governor proposes Turtle Bay buy-out

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Calling it "doable and essential to protect our way of life," Hawaii Gov. Linda Lingle proposed that the state buy the 850-acre Turtle Bay property on Oahu's rural North Shore to protect it from further development.

"I believe this is a once-in-a-generation chance to preserve both a lifestyle for thousands of residents and a part of Hawaii that millions the world over have come to love and identify as the real Hawaii," Lingle said in her State of the State address on Jan. 22.

Lingle called on government and community leaders to work together to explore options and develop an action plan to make sure the property stays in public hands. She pointed to the collaboration between the government and the private sector that led to the preservation of Waimea Valley and 1,129 acres of the Pupukea-Paumalu coastal bluff, also on the North Shore.

Turtle Bay hotel owner Kuilima Resort Co., which is owned by Los Angeles-based Oaktree Capital Management, has been seeking a buyer or development partner since June 2006 to help finance an expansion that would add up to five new hotels with 3,500 rooms and condominium units on undeveloped oceanfront property.

The eight-fold expansion, initially approved 20 years ago but only partially implemented, is widely opposed by Hawaii residents and lawmakers, who cite increased traffic, environmental degradation and the possible disturbance of previously undiscovered Hawaiian burial grounds among their concerns.

The company has invested more than $100 million in renovating the existing hotel, putting up the Ocean Villas condominium project and preparing for the expansion, according to an attorney for Kuilima.

Late last year, a $283 million mortgage foreclosure lawsuit was filed against Kiulima Resort Co. by Credit Suisse, an international lender seeking payment of delinquent principal, interest and fees.

To contact reporter Margaret Myre, send e-mail to [email protected].

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