UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from [_______ to _______]

Commission file number 001-35492

(Exact name of registrant as specified in its charter)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

Documents Incorporated By Reference

Proportionately, the Commercial Real Estate segment represents 5353% percent of the Company's business, Land Operations represents 3029% percent and Materials & Construction represents 1718% percent (determined by its share of 20162017 identifiable assets from the three segments). Additional information about our business segments is provided in "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the "Notes to Consolidated Financial Statements," which are included elsewhere in this Form 10-K.

Strategically, the Company remains principally focused on:

The HawaiiOur commercial real estate strategy focuses on Hawai`i, where we benefit from the Company’s deep relationships built over 147 years of operation in the islands, as well as a market benefits generally from strongpositioned for stability and growth given the state’s lack of commercially-entitled lands and robust economic underpinnings rooted in a resilient and high-performing tourism industry and high levels of military and government spending due to Hawaii's strategic defense location between the continental U.S. and Asia.performance. With a high median household income of $73,500, lownearly 30% above the U.S. national average, the lowest unemployment of 2.9%rate in the nation at 2.0%, solid personal income growth of 2.7%exceeding 3% per annum, and a low 12.1 square feet of strip retail GLA per capita on Oahu, the Hawaii commercialHawai`i retail market is a high-quality market that compares favorably with other top-tier retail markets in the U.S., like Austin, Denver, and Boston. Similarly, given the severe shortage of industrial supply in Hawaii,Hawai`i, industrial market rents and per square foot values exceed those achieved in other U.S. markets, making HawaiiHawai`i a high-performing industrial market. Asmarket despite its geographic isolation. In addition to strong resident demographics and market fundamentals, the Hawai`i commercial real estate market is supported by a growing and resilient tourism industry as well as consistently high levels of government spending due to Hawai`i’s strategic defense location between the U.S. and Asia. Therefore, as a result of the Company's Migration Strategy, not only have itsour assets been concentrated where management is best able to enhance portfolio performance, but the overall asset quality of theour portfolio has significantly improved.

To further enhance asset quality and increase the recurring income stream from theour commercial portfolio, the Company intends to:

A&B strives to maximize value in its landholdings by employing land at its highest and best use to the benefit of shareholders, employees, its communities and other key stakeholder groups. Certain lands owned by the Company are designated for urban uses or for future urban uses and are in various stages of entitlement. For those lands, we intend to continue the entitlement processes and pursue either development of commercial real estate assets for our own portfolio, or monetization over time through sales of land or developed properties. In pursuit of these objectives, the Company intends to:

For a significant portion of A&B’s substantial HawaiiHawai`i landholdings, this impliesthe Company employs a wide spectrum of non-development uses, ranging from conservation/watershed to pasture to active farming, including diversified agriculture.farming. While a majority of A&B’s landholdings has limited or no long-term urban development potential, these landholdings remain valuable for farming and other uses, such as providing access to natural resources or hydro-electric generation capability. Company initiatives toTo employ these landholdings at their highest and best use, include:the Company intends to:

A&B maintains cost benefits through aGP’s vertically integrated businessproduction model that encompasses the productionincludes ownership of aggregate and the importation ofan import terminal for liquid asphalt and sand. These activities helpadditional resources ensure that A&B has adequateGP’s access to raw materials needed to produce asphaltic concrete and therefore, also provides for a level of cost certainty that allows A&Benable it to compete effectively on sealed-bid contracts.cost effectively. In addition, A&BGP offers a variety of related for-sale and its consolidatedfor-rent services including temporary and non-consolidated affiliated companies provide and market various construction- and traffic-control-related products and services.

ITEM 2. PROPERTIES BY BUSINESS SEGMENTS

A.    Commercial Real Estate Segment

A&B’s HawaiiHawai`i commercial real estate portfolio consists of retail, industrial and office properties, comprising approximately 2.93.0 million square feet of GLA as of December 31, 2016.2017. Most of the commercial properties are located on Oahu and Maui, with smaller holdings on Kauai and the Island of Hawaii.Hawai`i. The average occupancy for the HawaiiHawai`i portfolio was 9393.5 percent inand 93.4 percent as of December 31, 2017 and 2016, unchanged from 2015.respectively.

On the Mainland, A&B owns a portfolio of sevensix commercial properties, acquired primarily by way of tax-deferred, 1031§1031 exchanges and consisting of retail, industrial and office properties, comprising approximately 1.81.0 million square feet of leasable space as of December 31, 2016.2017. The occupancy for the Mainland portfolio was 94.1 percent and 90.4 percent as of December 31, 2017 and 2016, respectively.

An additional 2,5001,068 acres on Maui, Kauai and Oahu are leased from third parties and are not included in any of the tables.

The entitlement process for development of property in HawaiiHawai`i is complex (involving numerous State and County regulatory approvals), lengthy (spanning multiple years) and costly (requiring costs to comply withsignificant expenditures for the conditionspreparation of studies and applications for approval). For example, conversion of an agriculturally-zoned parcel usually requires the following approvals:

The entitlement process is complicated by the conditions, restrictions and exactions that are placed on these approvals, including, among others, requirements to construct infrastructure improvements, payment of impact fees, restrictions on the permitted uses of the land, requirements to provide affordable housing and required phased development of projects.

(2)    Development-For-SaleDevelopment-for-sale Projects

Various vertical construction programs are being pursued at Kukui'ula in joint ventures with five third-party developers. In 2016,2017, the joint venture recorded 14 closings. An additional four units are under binding contracts as15 sales of December 31, 2016.

    A&B has renewable hydroelectric and solar facilities on the island of Kauai, operated by McBryde Resources, Inc. (“McBryde”), and has two financial investments in solar projects on Kauai and Oahu.

In 2016,2017, McBryde produced 28,09927,019 MWH of hydroelectric power (compared with 27,60028,099 MWH in 2015)2016) and 10,70011,056 MWH of solar power from its Port Allen Solar Facility (compared with 11,40010,700 MWH in 2015)2016). To the extent it is not used in A&B-related operations, McBryde sells electricity to Kauai Island Utility Cooperative (“KIUC”). Power sales in 20162017 amounted to 30,78330,861 MWH (compared with 30,80030,783 MWH in 2015)2016). The decrease in power sold was primarily due to higher internal power consumption.

C.    Materials & Construction

(1)    Quarries and Quarry Facilities

Grace owns 542541 acres in Makakilo, Oahu, approximately 200 acres of which are used for its quarrying operations. Approximately 900,000750,000 tons of rock were mined and processed by Grace in 2016.2017. The operation of the quarry is governed by special and conditional use permits, which allow Grace to extract aggregate through 2032. Grace also owns approximately 264 acres on Molokai, which are licensed to a third-party operator for quarrying operations.

The length of time that projects remain in backlog can span from a few days for a small volume of work to approximately 36 months for large paving contracts and contracts performed in phases. Backlog includes estimated revenue from the remaining portion of contracts not yet completed, as well as revenue from approved change orders.

Employees and Labor Relations

Available Information

A&B files reports with the Securities and Exchange Commission (the “SEC”). The reports and other information filed include: annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and other reports and information filed under the Securities Exchange Act of 1934 (the “Exchange Act”).

The public may read and copy any materials A&B files with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains a website at www.sec.gov, which contains reports, proxy and information statements, and other information regarding A&B and other issuers that file electronically with the SEC.

ITEM 1A. RISK FACTORS

A&B’s business and its common stock are subject to a number of risks and uncertainties. You should carefully consider the risks and uncertainties described below, together with all of the other information in this Form 10-K and the Company’s filings with the U.S. Securities and Exchange Commission. Based on information currently known, A&B believes that the following information identifies the most significant risk factors affecting A&B’s business and its common stock. However, the risks and uncertainties faced by A&B are not limited to those described below, nor are they listed in order of significance. Additional risks and uncertainties not presently known to A&B or that it currently believes to be immaterial may also materially adversely affect A&B’s business, liquidity, financial condition, results of operation and cash flows. This Form 10-K also contains forward-looking statements that involve risks and uncertainties.

If any of the following events occur, A&B’s business, liquidity, financial condition, results of operations and cash flows could be materially adversely affected, and the trading price of A&B common stock could materially decline.

Risks RelatingRelated to A&B’s BusinessREIT Status

The Company'sOur business, including itsour assets and operations, areis concentrated in Hawaii.Hawai`i. A weakening of economic drivers in Hawaii,Hawai`i, which include tourism, military and consumer spending, public and private construction starts and spending, personal income growth, and employment, or the weakening of consumer confidence, market demand, or economic conditions on the Mainland, may adversely affect the demand for or sale of HawaiiHawai`i real estate, the level of real estate leasing activity in HawaiiHawai`i and on the Mainland, and demand for the Company'sour materials and construction products. In addition, an increase in interest rates or other factors could reduce the market value of the Company'sour real estate holdings, as well as increase the cost of buyer financing that may reduce the demand for A&B'sour real estate assets.

There are numerous other developers, buyers, managers and owners of commercial and residential real estate and undeveloped land that compete or may compete with A&Bus for management and leasing revenues, land for development, properties for acquisition and disposition, and for tenants and purchasers of properties. Intense competition could lead to increased vacancies, increased tenant incentives, decreased rents, sales prices or sales volume, or lack of development opportunities.

Our wholly owned subsidiary Grace Pacific LLC (“Grace” or “Grace Pacific”) competes in an industry that favors the lowest bid. An increase in competition,Increasing competitive market conditions, including out-of-state or new in-state contractors competing for a limited number of projects available, could leadadversely impact our results of operations through market share erosion due to lost bids, as well as lower pricing and thus lower prices and volume.margins realized on successful bids. Grace also mines aggregate and imports asphalt for sale. Grace'sGrace’s customers could seek alternative sources of supply, similar to some of its competitors that are importing liquid asphalt and aggregate.

The successful execution of A&B’sour strategy requires substantial amounts of operating and development capital. Sources of such capital could include banks, life insurance companies, public and private offerings of debt or equity, including rights offerings, sale of certain assets and joint venture partners. If A&B’sour credit profile deteriorates significantly, itsour access to the debt capital markets or itsour ability to renew itsour committed lines of credit may become restricted, the cost to borrow may increase, or A&Bwe may not be able to refinance debt at the same levels or on the same terms. Further, A&B relieswe rely on itsour ability to obtain and draw on a revolving credit facility to support itsour operations. Volatility in the credit and financial markets or deterioration in A&B’sour credit profile may prevent A&Bus from accessing funds. There is no assurance that any capital will be available on terms acceptable to A&Bus or at all to satisfy A&B’sour short or long-term cash needs.

To execute itsour business strategy, A&Bwe may require additional capital. If A&B incurswe incur additional debt or raisesraise equity, the terms of the debt or equity issued may give the holders rights, preferences and privileges senior to those of holders of A&Bour common stock, particularly in the event of liquidation. The terms of any new debt may also impose additional and more

A&B’sOur credit facilities and term debt contain certain restrictive financial covenants. If A&B breacheswe breach any of the covenants and such breach is not cured in a timely manner or waived by the lenders, and results in default, A&B’sour access to credit may be limited or terminated and the lenders could declare any outstanding amounts immediately due and payable.

Interest expense on A&B'sour floating-rate debt ($101.675.9 million as of debt outstanding for the year ending December 31, 2016)2017) would increase if interest rates rise. Additionally, the interest expense associated with fixed-rate debt could rise in future periods when the debt matures and is refinanced. Furthermore, the value of our commercial real estate portfolio and the market price of our stock could decline if market interest rates increase and investors seek alternative investments with higher distribution rates.

A&B'sOur various businesses have significant operating agreements and leases that expire at various points in the future. These agreements and leases may not be renewed or could be replaced on less favorable terms.

Fuel prices have a direct impact on the health of the HawaiiHawai`i economy. Increases in the price of fuel may result in higher transportation costs to HawaiiHawai`i and adversely affect visitor counts and the cost of goods shipped to Hawaii,Hawai`i, thereby affecting the strength of the HawaiiHawai`i economy and its consumers. Increases in fuel costs also can lead to other non-recoverable, direct expense increases to A&Bus through, for example, increased costs of energy and petroleum-based raw materials used in the production of aggregate, and the manufacture, transportation, and placement of hot mix asphalt. Increases in energy costs for A&B’sour leased real estate portfolio are typically recovered from lessees, although A&B’sour share of energy costs increases as a result of lower occupancies, and higher operating cost reimbursements impact the ability to increase underlying rents. Rising fuel prices also may increase the cost of construction, including delivery costs to Hawaii,Hawai`i, and the cost of materials that are petroleum-based, thus affecting A&B’sour real estate development projects.projects and margins.