Hawaii licensing law delays $800M P3 arena project a year

Dive Brief:

A Hawaii law that requires companies responding to requests for qualifications (RFQs) and requests for proposals (RFPs) to be state-licensed general contractors has delayed an $800 million public-private partnership (P3) with the city by at least a year, Pacific Business News reported.
Honolulu wants to redevelop its Neal S. Blaisdell Center arena, replacing the existing exhibition space and parking with new construction and renovating the center's concert hall and arena. However, any company wishing to submit its qualifications or a proposal must first be licensed in Hawaii as a general contractor. Originally, the project RFQ was scheduled to go out last July, but in order to give organizations the time to complete the licensing process, it will be issued next month instead, with RFPs expected in December.
The state legislature is expected to address the licensing issue in its next session since it could impact other P3s, like the Honolulu rail project and the redevelopment of Aloha Stadium.

Dive Insight:

In response to the city's request for information, 13 companies responded: AEG Facilities; Blaisdell Development Partners/Nordic PCL Construction; EllisDon Capital; Hunt Cos.; Infared Capital Partners; Johnson Controls; Macquarie Capital/Hensel Phelps; Pacific Consultants; Plenary Group; Rider Levett Bucknall; Norwegian architecture and landscape firm Snohetta; Spectra Venue Management; and Woods Bagot.

Each bidding team, city officials told the Business News, is expected to break into five subgroups, each of which will manage design, construction, financing, operations and maintenance. The city expects to reach financial close by December 2020 and then apply for the necessary permits.

The Honolulu Authority for Rapid Transportation believes it can save money by completing the last segment of the troubled $9 billion Honolulu rail project using a P3 rather than other delivery methods. The current budget is twice the original estimate, and the project is six years behind schedule. Adding to the authority's problems, the Department of Justice in February subpoenaed all records related to the project, indicating that the government could be concerned about criminal activity in addition to the mismanagement captured in a state auditor's report issued in January.

Construction of a new Aloha Stadium, which is Hawaii's largest outdoor arena and home to the University of Hawaii football team, is still likely years from construction as officials are still trying to decide on a new site and only recently started the environmental impact statement process and master planning for a new venue.