Barnwell Industries announces real estate transaction through KD
Barnwell Industries announced that its 77.8%-owned real estate venture Kaupulehu Developments, or KD, has entered into new agreements with the developer of the Increment II portion of Lot 4A at Kaupulehu, North Kona, Hawaii, as part of a transaction to admit a new development partner to move forward with development of the remainder of Increment II at Kaupulehu. Alexander Kinzler, CEO of Barnwell, said, "We are pleased to report that a new development entity has committed to moving forward with the Increment 2 portion of the development at Kaupulehu, North Kona, Hawaii. The new entity was admitted as a 45% partner in the entity developing Increment 2, thereby reducing the existing partners' percentage ownership, but setting the stage for new projects to move forward in Increment 2. We have also made changes to the manner in which KD receives compensation for future residential development at Increment II, and we will now have a 15% net profits interest in the Increment II venture as well as the right to receive a priority payout of an additional share of net profits up to $3,000,000 and other consideration from the developer, as opposed to the 8% interest in gross sales KD previously had and the right KD had to receive preferential payments of up to $8,000,000, of which $3,500,000 has been received. No changes were made to KD's agreements with respect to Increment I. We believe that these changes will positively impact the Company going forward. Barnwell's affiliates have been involved with this project since 1984 and we look forward to many more years of development success at Kaupulehu as Increment II moves forward."