The U.S. Navy, Pacific Division Real Estate Team used the ideas of 03-POL-003, the National Aeronautics and Space Administration (NASA) Ames Development Plan and combined it with 01-PRA-019, Navy’s Outleasing and Partnership Initiatives and 01-POL-004, Department of Defense (DOD) Enhanced-Use Leasing Initiative to develop and award the Ford Island Master Development Agreement (MDA).
A multi-disciplined team from the Navy blended a wide variety of legal authorities, public and private funding, and business approaches to infuse energy and development to restore Ford Island, which is contained in the Pearl Harbor Naval Complex. Using bold innovation, this high performance team developed a masterful marketing strategy for implementing the program and was successful in obtaining special legislation in September 1999 (10 USC 2814) to enter into the Ford Island Master Development Agreement that was executed in June 2003. The groundbreaking legislation, which included both conveyance and leasing authorities, predated the enhanced use authority for similar undertakings.
The concept plan for Ford Island grew out of a unique set of circumstances. An old airfield, several military training facilities, a data processing office, two bachelor quarter facilities, approximately 50 housing units and a number of significant historic buildings dominate Ford Island. A small vehicle ferry and a fleet of launches for Navy personnel were the only means of access until the Ford Island Bridge was completed in 1998.
The $800 million Development Program for Ford Island encompasses military construction, housing privatization projects, private commercial ventures, and enhanced use leasing. The team identified underutilized or excess properties and leveraged them to obtain in-kind construction on Ford Island. Over 1,600 acres in five main areas on the island of Oahu, HI, including approximately 2,000 family housing units, are covered in the MDA in exchange for an immediate $84 million benefit to the Navy, with future sales expected to provide an additional $50 million. All leases contain substantial protections and safeguards for the benefit of the Navy as it relates to asset management, in addition to future upward rental adjustments based on certain future market use triggers. The 20 year net present value of this transaction to the Navy is over $180M, resulting in an exceptional leveraged return on minimal investment.
For more information, contact Mr. Joseph Calcara at (808) 472-1504 or via e-mail at joseph.calcara@navy.mil
