Alexander & Baldwin Announces New Development Project at Komohana Industrial Park

Rhea-AI Summary

Alexander & Baldwin (NYSE: ALEX) announced plans to redevelop part of its Komohana Industrial Park in Kapolei, O'ahu. The project involves constructing two Class A industrial buildings totaling 121,000 square feet of gross leasable area. The development includes a 91,000-square-foot build-to-suit distribution center pre-leased to Lowe's and a 30,000-square-foot spec building that can be split into two units. The project will replace an existing 16,000-square-foot building on 5.7 acres. Upon completion in Q4 2026, KIP's total GLA will increase by 44% to approximately 343,000 square feet, with additional land available for future development. The expansion addresses Hawaii's tight industrial market needs and evolving retail trends focused on buy-online-pick-up-in-store services.

Positive

• 75% of the expansion is pre-leased to Lowe's, a high-quality national retailer
• Project will increase KIP's gross leasable area by 44% to 343,000 square feet
• Additional land remains available for future development
• Net gain of 105,000 square feet of leasable space (121,000 new - 16,000 demolished)
• Strategic expansion in one of the tightest industrial markets in the U.S.

Negative

• Construction completion not expected until Q4 2026
• 25% of the new space (30,000 sq ft) remains unleased

Insights

Commercial Real Estate Analyst

A&B's 121,000 sq ft industrial expansion in tight Hawai'i market with 75% pre-leased to Lowe's demonstrates strategic asset optimization.

Alexander & Baldwin's redevelopment project at Komohana Industrial Park (KIP) represents a strategic optimization of their existing land assets in a market known for extremely limited industrial availability. The company is effectively converting underutilized yard space into high-demand leasable area, increasing KIP's gross leasable area (GLA) by an impressive 44% to reach approximately 343,000 square feet.

The pre-leasing of 75% of the expansion to Lowe's as a build-to-suit distribution center is particularly significant. This arrangement typically involves longer lease terms and higher-quality tenant relationships than standard leases, providing A&B with secure cash flow visibility through the development phase and beyond. The remaining 30,000 square foot speculative building, which can be divided into smaller units, offers flexibility to capture additional market demand.

This development aligns perfectly with evolving retail logistics trends, particularly the growing demand for buy-online-pick-up-in-store capabilities that require retailers to maintain larger local inventory positions. By expanding in Kapolei, A&B is strengthening its position in O'ahu's industrial corridor while maintaining future development optionality with their remaining land.

The project's expected completion in Q4 2026 provides a clear timeline for when this asset enhancement will begin contributing to A&B's net operating income. This development approach - maximizing value from existing land holdings rather than pursuing acquisitions in an expensive market - demonstrates disciplined capital allocation focused on organic growth opportunities within their portfolio.

Construction of Two Class A Industrial Buildings Expands Industrial Inventory in Kapolei

HONOLULU, May 29, 2025 /PRNewswire/ -- Alexander & Baldwin, Inc. (NYSE: ALEX) ("A&B" or "Company"), a Hawai'i-based owner, operator, and developer of high-quality commercial real estate in Hawai'i, announced it will redevelop a portion of its largest industrial asset, Komohana Industrial Park ("KIP") in Kapolei, O'ahu, with the construction of two Class A industrial buildings totaling approximately 121,000 square feet of gross leasable area ("GLA").

The project will replace an existing 16,000-square-foot building on 5.7 acres of land with a 91,000-square-foot build-to-suit distribution center that is pre-leased to Lowe's and a 30,000-square-foot spec build that could be divided into two 15,000-square-foot-units. Upon completion, KIP's GLA will increase 44% to approximately 343,000 square feet. Construction of the two buildings is expected to be completed in the fourth quarter of 2026.

"We identified an opportunity to convert under-utilized yard area into new warehouse space, consistent with Alexander & Baldwin's strategy of using our existing inventory of industrial-zoned land to meet the needs of one of the tightest industrial markets in the U.S.," said Lance Parker, president and chief executive officer. "Once complete, Komohana Industrial Park will have nearly 350,000 square feet of GLA with additional land available for future development."

"Our ability to pre-lease 75% of this expansion to a high-quality national retailer with a build-to-suit structure speaks to our development capability and demonstrates the strength of the Hawai'i industrial and retail markets," added Jordan Brant, senior vice president of leasing. "Local consumer preferences have evolved with buy-online-pick-up-in-store, and as a result, retailers continue to drive demand for high-quality industrial space to carry inventory and provide faster delivery times."

ABOUT ALEXANDER & BALDWIN

Alexander & Baldwin, Inc. (NYSE: ALEX) (A&B) is the only publicly-traded real estate investment trust to focus exclusively on Hawai'i commercial real estate and is the state's largest owner of grocery-anchored, neighborhood shopping centers. A&B owns, operates and manages approximately 4.0 million square feet of commercial space in Hawai'i, including 21 retail centers, 14 industrial assets and four office properties, as well as 146 acres of ground lease assets. Over its 155-year history, A&B has evolved with the state's economy and played a leadership role in the development of the agricultural, transportation, tourism, construction, residential and commercial real estate industries.

FORWARD-LOOKING STATEMENTS

Statements in this release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding possible or assumed future results of operations, business strategies, growth opportunities and competitive positions. Such forward-looking statements speak only as of the date the statements were made and are not guarantees of future performance. Forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from those expressed in or implied by the forward-looking statements. These factors include, but are not limited to, prevailing market conditions and other factors related to the Company's REIT status and the Company's business, the evaluation of alternatives by the Company related to its non-core assets and business, and the risk factors discussed in the Company's most recent Form 10-K, Form 10-Q and other filings with the Securities and Exchange Commission. The information in this release should be evaluated in light of these important risk factors. We do not undertake any obligation to update the Company's forward-looking statements.

Learn more about A&B at www.alexanderbaldwin.com.

Leasing Contact:
Cheyne Mench
cmench@abhi.com

Media Contact: 
Tran Chinery
tchinery@abhi.com 

Investor Contact:
Jordan Hino
jhino@abhi.com

 

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SOURCE Alexander & Baldwin, Inc.

FAQ

What is Alexander & Baldwin's (ALEX) new development project at Komohana Industrial Park?

Alexander & Baldwin is constructing two Class A industrial buildings totaling 121,000 square feet at Komohana Industrial Park in Kapolei, O'ahu. This includes a 91,000-square-foot distribution center pre-leased to Lowe's and a 30,000-square-foot spec building.

When will ALEX complete the new Komohana Industrial Park development?

The construction of the two new industrial buildings is expected to be completed in the fourth quarter of 2026.

How much will the Komohana Industrial Park expansion increase Alexander & Baldwin's leasable area?

The expansion will increase Komohana Industrial Park's gross leasable area by 44%, from approximately 238,000 to 343,000 square feet.

Who is the main tenant for ALEX's new Komohana Industrial Park development?

Lowe's has pre-leased the 91,000-square-foot build-to-suit distribution center, representing 75% of the new development.

What is the purpose of Alexander & Baldwin's Komohana Industrial Park expansion?

The expansion aims to meet the growing demand for industrial space in Hawaii's tight market and support retailers' needs for inventory storage and faster delivery times, particularly for buy-online-pick-up-in-store services.