Executive Summary

Development Pipeline

Industrial & Commercial Projects

Entitlement Risk

Approval Patterns

• Utility Dedications: Roadway and sewer easements related to new subdivisions are processed efficiently when presented at no cost to the city .
• Industrial Operating Costs: There is a clear pattern of removing regulatory hurdles for industrial users, evidenced by the repeal of high-strength wastewater surcharges to align with modern permitting .
• Resilient Shoreline Design: SMA permits are consistently granted when applicants elevate habitable portions above base flood elevations and accept liability for future coastal erosion .

Denial Patterns

• Agritourism Loophole Exploitation: Projects attempting to use "Agribusiness" permits for major tourism attractions (e.g., gondolas) face aggressive Council opposition and requests for permit revocation .
• Incomplete SMA Applications: The Council has expressed frustration with "shabby" applications that fail to comply with Land Use Ordinances (LUO) before submission, leading to processing extensions .

Zoning Risk

• CUP Reclassification: Legislation is pending to move agritourism from a "Minor" to a "Major" Conditional Use Permit, which would mandate neighborhood board presentations and public hearings .
• Signage Modernization: Standards for apartment and mixed-use districts are being loosened to allow ground-floor businesses more visible street frontage signage .

Political Risk

• Budget Execution Tensions: Friction exists between the Council and the Department of Budget and Fiscal Services (BFS) over new reporting requirements for fund transfers and lapsed appropriations .
• Home Rule vs. State Authority: The Council is actively pushing to affirm county authority over affordable housing to counter state-level acts that have stripped local regulatory powers .

Community Risk

• Neighborhood Board Oversight: There is strong community momentum to require neighborhood board presentations for all SMA "Minor" permits to increase transparency on small-lot developments .
• Transit Equity Concerns: Fare increases for adult and youth riders face criticism for disproportionately impacting low-income residents, despite exemptions for seniors and disabled riders .

Procedural Risk

• SHPD Processing Lag: The city is attempting to mitigate state-level delays by entering Memorandums of Understanding (MOU) to allow the DPP to conduct its own historic preservation reviews in specific districts .
• Software Implementation: While "Civ Check" aids intake, the transition to "Honolulu Build" continues to present challenges for specific sectors, such as the solar industry .

Key Stakeholders

Council Voting Patterns

• Transparency Advocates: Chair Waters and Vice Chair Nishimoto are primary drivers of legislation (Bills 76, 77) to mandate open-data portals and real-time budget tracking .
• Logistics & Safety Focus: Councilmember Tupola is the lead on taxi modernization and HPD staffing retention strategies .
• Skeptics of Rapid Expansion: Councilmember Tolba and others have voiced concerns over the fiscal responsibility of planning rail extensions before Segment 2 is fully operational .

Key Officials & Positions

• Don Tokuchi Apuna (DPP Director): Advocating for software-driven efficiency (Civ Check) but resisting mandated neighborhood board reviews for "Minor" permits to avoid doubling processing times .
• Andy Kawano (BFS Director): Opposes increased reporting mandates (Bills 64, 65), citing them as an "unnecessary administrative burden" that provides inaccurate predictive data .
• Lori Kahikina (HART CEO): Actively seeking authority to begin planning and preliminary engineering for rail extensions to Manoa and West Kapolei .

Active Developers & Consultants

• Avalon Development: Active in downtown revitalization and advocating for flexibility in affordable housing marketing periods .
• Kobayashi Group: Proposing high-density, sustainable mixed-use projects in the Ala Moana TOD corridor .
• Planning Solutions, Inc. / Well Environmental: Leading agents for the majority of residential SMA Major permits in shoreline areas .

Analysis & Strategic Insights

Industrial Momentum vs. Entitlement Friction

Industrial development is benefiting from a "housekeeping" era where the city is removing antiquated surcharges and surrendering unutilized regulatory fees . However, "friction" is intensifying at the intersection of agriculture and commercial use. Developers should expect that any project with an industrial component in an Ag-zoned area will now be scrutinized under "Major" CUP standards .

Probability of Approval

• Infill Infrastructure/Easements: High. The Council is prioritizing the securing of sewer and roadway rights to support existing urban density .
• Logistics in Urban Core: Moderate. Projects that integrate with TOD goals or offer graywater/renewable benefits have a smoother path than standalone warehouse facilities.
• Speculative Agritourism: Low. The political climate has shifted sharply against uses that do not have a primary, demonstrated agricultural output .

Strategic Recommendations

• Site Positioning: Focus on the Primary Urban Center (PUC) where new FAR standards (Bill 6) are expected to add significant housing and mixed-use capacity, reducing the need for special incentives .
• Entitlement Sequencing: Utilize the "Civ Check" voluntary screening early in the design phase to identify potential land-use violations before formal submission, which significantly reduces DPP review time .
• Stakeholder Engagement: For projects in historic districts like Chinatown or Merchant Street, engage DPP directly regarding the new MOU process to bypass potential SHPD backlogs .

Near-Term Watch Items

• April 2026: Federal mandate for all city websites to meet strict ADA accessibility standards; watch for impacts on permitting portals .
• March 2026: Honolulu Zoo accreditation review; watch for infrastructure funding opportunities related to perimeter safety .
• CUP Modification Decisions: Watch for DPP's upcoming ruling on the Kamanui modifications (expected late 2025/early 2026), which will set the precedent for agritourism enforcement .