In the end, the 4.7-acre oceanfront property that Yue-Sai Kan bought in 2021 for $3.6 million turned out to be more trouble than it was worth.
Last month, the media and cosmetics magnate settled violation cases before the state Board of Land and Natural Resources stemming from the intentional killing last year of a protected, nesting Laysan albatross on her property, as well as the unauthorized construction of fences and clearing of endangered bee habitat within the state Conservation District.
On April 26, the Department of Land and Natural Resources’ Division of Forestry and Wildlife and Office of Conservation and Coastal Lands presented their recommendations to the board regarding several violations that had been identified within the 96-acre Marconi Point Condominiums property, located next to the Turtle Bay Resort on O`ahu’s North Shore.
Kan owns Unit 1 within the agricultural condominium property regime.
The agencies recommended a total of $3.2 million in fines against various unit owners, as well as the condominium’s newly formed owners association.
DOFAW had determined that Kan (and the Yue-Sai Kan Trust), Sushil Garg (who owns several units through three of his companies), as well as his employee, Benjamin Lessary, were responsible for the massive clearing last October of native vegetation along the coastline spanning the entire project.
Although it seemed that the work was done at Garg’s behest, Kan, who was aware of the protected species that inhabited the area, had consented to the clearing of vegetation along her unit, the agencies found.
For the killing of an estimated 300 endangered Hawaiian yellow-faced bees, DOFAW recommended a $1,502,500 fine. DOFAW also recommended a fine of $15,000 against Kan for the killing of the albatross known as Ho`okipa by one of her landscapers. The OCCL recommended a fine of $30,000 against her for illegal fence construction in the Conservation District, which included the iron fence in which Ho`okipa had gotten stuck in when she was killed.
Kan’s attorney, Eric Robinson, requested a contested case hearing. At the same time, he announced Kan’s commitment to removing the problematic fencing.
Attorneys representing Garg and two unit owners who objected to the association being included in the violation case also requested a contested case hearing.
By mid-June, most of the iron fence had been removed. And on July 12, after mediation discussions with Kan’s attorney, the OCCL and DOFAW requested board approval of a settlement agreement that they had reached regarding those violations that applied to her.
Kan agreed to donate her unit to the North Shore Community Land Trust, which has been doing native habitat restoration within a large conservation area adjacent to her lot, fronting the Turtle Bay Resort golf course.
In return, the DLNR agreed to not pursue criminal charges. Kan would also not need to admit any fault, liability, guilt or obligation.
According to a staff report, Kan had offered to donate the property to the state, but the DLNR declined because the land is part of a condominium property regime, where owners would be required to pay dues and participate in the association of unit owners. The land trust, however, agreed to take on the property and to restore it.
“Ms. Kan and the North Shore Community Land Trust have discussed the remainder of solid materials on Unit 1 (a farm dwelling and two greenhouses) and have agreed to resolve such matters in a manner that best suits each party and complies with all applicable county and state laws.
“The last remaining fence on Unit 1, a shade cloth fence that runs perpendicular to the shoreline, still remains but the department anticipates it will be removed shortly or upon the North Shore Community Land Trust assuming ownership of Unit 1,” the staff report states.
The farm dwelling and greenhouses are the subject of a notice of violation the City & County of Honolulu’s Department of Planning and Permitting issued on March 22. Kan also received another notice of violation from the DPP that day for unauthorized development within the city’s Special Management Area and damages to wetland areas. (Kan was one of several unit owners to receive the latter violation notice, which threatens fines of $100,000, plus $10,000 per violation per day).
Under the draft settlement presented to the board, “The Parties agree to resolve, or otherwise address in a manner agreed to by Kan and the Land Trust (e.g., by Kan obtaining a ‘No Action Letter’), any outstanding matters between Kan and the City and County of Honolulu, Department of Planning and Permitting and any other governmental agency relating to Unit 1 prior to the transfer of title to the Land Trust. In the event that there are outstanding fines, fees, or liens, associated with Unit 1 prior to the effective date of this agreement, Kan agrees to resolve such issues within thirty days and will not seek to transfer any such issues to the Land Trust upon the transfer of title.”
“By allowing Ms. Kan to donate Unit 1 to the North Shore Community Land Trust and the North Shore Community Land Trust being committed to Unit 1’s restoration for the benefit of indigenous and rare species, the State is furthering the Department’s goals of having contiguous high-quality coastal strand habitat for Conservation, protection, and management of indigenous, rare, and endangered species.. The parties are exploring options for the conveyed deed for Unit 1 to contain a clause that the property shall be used solely to benefit native species and the coastal strand habitat.
“This proposed settlement will not compensate the State for the devastating loss of Ho‘okipa, the numerous federally listed endangered nalo meli maoli [yellow-faced bees], or the high-quality coastal strand habitat across the shoreline of Unit 1 that occurred in October 2023, but it will ensure that Unit 1 is preserved for the benefit of those same species and restored with their survival in mind,” the staff report states.
In addition to the pending DLNR and DPP violation cases, Kan has faced an uphill battle to build a true farm dwelling on her lot, which was one of the few within the CPR where one was allowed. (The dwelling that received a violation notice was for a “barn” on stilts that she had illegally upgraded with water and electricity.)
The DPP had rejected a previous application by Kan for a Special Management Area permit to construct her farm and house. She would need to secure one before development of her coastal lot could occur.
What’s more, according to an April 2022 farm design and operational plan for her company Da Farm by Da Sea, LLC, prepared by WHALE Environmental Services, LLC, soil testing across her unit suggested that any kind of farming there would be a challenge.
“[M]oisture regimes is likely to be an issue for this site, creating excessive irrigation needs. Over 85% of the soils on the site are extremely permeable, meaning that water drains rapidly. Even during the field work on this site over two weeks which involved 5 straight days of trade wind showers; soils were well-drained within 24- 48 hours, rapid permeability. As well, the loose, unconsolidated nature of the soils increases leaching factors, meaning nutrients and other amendments will be pulled away from root structures. Mitigations for moisture issues will need to be addressed.”
In 2024, her unit, split-zoned preservation and agriculture, had a tax-assessed value of just a little under $2 million. Given that she will be donating her land directly to a non-profit organization, she will likely be able to deduct the assessed market value from her taxes.
The trust’s executive director, Adam Borrello, testified that he was humbled by the potential opportunity for the trust to take on stewardship of Kan’s parcel. He said that the trust has been restoring the area fronting the Turtle Bay golf course since 2015 and has seen an increasing number of native plant and animal species thriving there, including the albatross.
“This provides us with a wonderful access point. … We hope we can be a stabilizing presence,” Borrello said.
Land Board chair and DLNR director Dawn Chang said that the trust was much better situated than the department is to enhance the area.
Borrello said he appreciated the community, the attorney general’s office and Kan’s willingness “to have a vision that would consider this type of settlement. …
“We have every confidence that this effort will outlive myself and those of us gathered here. We have every confidence we’ll continue to develop new people and create new networks to ensure this magical coastline stays that way,” he said.
Chris Tarski, a volunteer who has been monitoring protected species in the area for the last six years, provided an update on Ho`okipa’s egg, which was rehomed after the bird’s death.
Tarski reported that she was the person who had transported Ho`opika’s body from the veterinarian’s office to where it was autopsied.
“I cried tears. I promised Ho`okipa something good would come out of something so tragic and that’s what I see this settlement with Yue-Sai Kan,” Tarski said.
She added that since many of the iron fence panels have been taken down, at least one albatross parent has had an easier time feeding its chick. In the past, the fence would often separate mates from each other and parents from their chicks.
“Ho`okipa’s egg has been fostered by parents at James Campbell [national wildlife refuge], has hatched and the chick is about ready to fledge,” she said.
Robinson said he was happy to be before the board with good news and thanked the various people and agencies involved, specifically naming USFWS biologist Sheldon Plentovich and Kan’s consultant, Mark Howland, “for their efforts and keeping open lines of communication and helping make this happen.”
“This underscores Kan’s commitment to philanthropy and conservation in the community. It’s in a slightly different way than she originally envisioned but I think she’s still kind of achieving and doing honor to that goal,” he added.
Chang said she greatly appreciated Robinson’s representation of Kan. Maui Land Board member Doreen Canto added, “It’s never a win-win when something dies. In the case of Ho`okipa … it’s time to right the wrong.”
Denise Antolini, a founding member of the land trust who testified on behalf of the Aloha Marconi Alliance said the settlement was historic one that “sets a precedent for, let’s say, future matters.”
She added, “What better way to honor her [Ho`okipa’s] legacy than to approve this settlement?”
“It’s not a win-win, but it’s a huge step forward in the right direction,” testified the alliance’s Angela Huntemer.
Attorney Kalani Morse, who represents Garg, also chimed in, wanting to let everyone know he was looking forward to working with the trust as a future neighbor.
The board then unanimously approved a motion by Vernon Char to approve the settlement.
Contested Case Granted
Shortly after approving the settlement the board took up the matter of the contested case hearing petitions filed by Garg, Lessary, two of Garg’s companies that own affected units, the owner’s association, Tara and Wayne Hu (also unit owners), and the CPR’s developer, Makai Ranch, LLC.
Makai Ranch had asked in its petition that the Turtle Bay Resort be included as a party, arguing that the resort had built the unauthorized fence in the Conservation District. Community members, however, provided photos and testimony to the board proving that the fence was not built by the resort.
At the board’s meeting, attorney David Abitbol, representing Makai Ranch, asked to withdraw its request that the resort be named as a party in the violation case.
He added, “We would like to see that fence removed, the violating portion of it.”
Board member Riley Smith then asked Abitbol, “If you guys are supporting removing the fence and it’s in your property, why don’t you just remove it?”
Abitbol replied, “It appears the fence is located in a limited common element. … Makai Ranch alone wouldn’t necessarily have the power to remove it.”
Attorney Peter Lenhart, who represents the Hus, asked that the board separate out the alleged violation regarding unauthorized fencing in the Conservation District, and not have it lumped in with those violations that were allegedly caused by Garg and Lessary and may include millions of dollars in fines (i.e. the killing of endangered bees and vegetation clearing in the Conservation District).
“The waters are getting really muddy. Unit owners are getting thrown into the remaining allegations,” Lenhart said.
The board, however, decided that it would approve the contested case scope as is and let the hearing officer decide whether or how to separate the violations.
— Teresa Dawson
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