Teresita Santos
THE Department of Public Lands has no reason to question the reliability of Suwaso Corporation’s appraisal of the Coral Ocean Resort property because Suwaso’s appraiser, LBT Appraisal, “is regularly hired” by DPL for valuations of land compensation claims, DPL Secretary Teresita A. Santos told the Legislature.
She was responding to Senate Floor Leader Corina Magofna and Rep. Angelo Camacho, who “noted” in their letter last week that Suwaso, not DPL, conducted the appraisal of the COR property, which includes an 18-hole golf course in Koblerville.
Magofna chairs the Senate Committee on Resources, Economic Development and Programs while Camacho chairs the House Committee on Natural Resources.
A back-and-forth communication between DPL and the committee chairs has been ongoing for weeks in light of Suwaso’s proposal for a new land lease agreement ahead of the expiration of the 15-year extension of its current lease on Aug. 10, 2026.
According to the proposed new land lease contract, Suwaso will pay a base rent of 0.6% of the property’s fair market value for the first 10 years. The rent will increase to 1.125% for the remaining term of the lease. This rate “is determined based on the formula for matured leases, which takes into consideration the level of [the] cost proposed for capital improvements, and on DPL’s finding that reasonable justification exists for a base rent below 1.5% per year.”
An appraisal was conducted by LBT Appraisal for Suwaso.
In their letter to Santos, Magofna and Camacho said DPL should conduct its own appraisal to ensure that the rental value is based on a fair market value of the property.
But according to Santos, the statute governing DPL’s negotiation with a public land lessee “does not require DPL to procure its own appraisal; it requires that the new public land lease shall be based on rental based on at least two new appraisals of the property to be leased, including, but not limited to, improvements thereon.”
As required, Santos said, Suwaso’s proposal included two appraisals. One was conducted by LBT Appraisal, which is regularly hired by DPL to perform valuations for land compensation claims, “so DPL has no reason to question the reliability of its appraisal or to assume that having the property reappraised by LBT Appraisal for DPL would result in a substantially different value.”
In addition, Santos said incurring the cost to hire an off-island appraiser to perform an appraisal for DPL “does not seem to be a reasonable expense for administration and management of DPL for the accomplishment of its functions.”
