Barnwell Industries Announces Sale of Hawaii Real-Estate Interests for $1.77M

What Happened

• Barnwell Industries, Inc. (through subsidiary Barnwell Hawaiian Properties, Inc. and Ka’upulehu Developments) announced a Purchase and Sale Agreement dated July 31, 2026 to sell certain Hawaii real-estate interests to David Johnston. The assets include BHP’s 34.45% limited partner interest in KKM Makai, LLLP, BHP’s 75% general partner interest in KD Kona 2013 LLLP (the “Partner Interests”), KD’s rights in KD Acquisition II, LLLP and Increment 2 of Lot 4‑A at Ka’upulehu, and KD’s rights under an Agreement to Terminate Project Rights.
• The purchase price is $1,770,000 in cash at closing (allocated $770,000 to the Partner Interests and $1,000,000 to KD project/termination rights). After accounting for a minority partner (Cambridge Hawaii LP), net consideration to Barnwell is estimated at approximately $1.5 million. A pre‑closing distribution of $500,000 by Ka’upulehu Makai, LLLP is expected to produce roughly $100,000 additional to Barnwell. Closing is targeted on or before September 15, 2026 and is subject to customary conditions.

Key Details

• Buyer: David Johnston (son of a KD partner, Terry Johnston); Buyer agreed to indemnify Sellers against any commission claim by Terry Johnston or his affiliates.
• Sale terms: Partner Interests sold “AS‑IS”; Sellers’ reps/warranties limited and survive six months; each Seller’s liability capped at 10% of the portion of purchase price allocated to the assets it sold (subject to a $25,000 aggregate claim threshold); consequential and punitive damages excluded (except for actual common‑law fraud).
• Closing conditions include accuracy of reps/warranties, no restraining legal proceedings, a $500,000 distribution by Ka’upulehu Makai, LLLP, and no material adverse change in relevant entities. Purchase Agreement governed by Hawaii law.

Why It Matters

• The transaction, if closed, would largely exit Barnwell’s known remaining Hawaii real‑estate interests and provide roughly $1.5M in net proceeds plus a small expected pre‑closing distribution — reducing Barnwell’s ongoing exposure to those assets.
• Investors should note limited seller protections (short rep survival and liability caps), the related‑party connection between buyer and a KD partner (addressed by buyer indemnity), and that closing is not guaranteed — it is subject to customary conditions and could be delayed or terminated.