On September 20, 2018, about 1630 Hawaii standard time, a Mooney M20J airplane, N66201, was substantially damaged during a forced landing at Kalaeloa Airport/John Rodgers Field (PHJR) Kapolei, Hawaii. The certified flight instructor (CFI) and the private pilot receiving instruction were not injured. The airplane was registered to Perly Aviation Inc. and operated by Aviation Academy Hawaii under the provisions of Title 14 Code of Federal Regulations Part 91. Visual meteorological conditions prevailed, and a visual flight rules flight plan was filed for the local flight. The flight originated from Daniel K. Inouye International Airport (PHNL), Honolulu, Hawaii, about 1430, with an intended destination of PHJR. The CFI reported that, prior to preflight, the airplane's battery was replaced due to an insufficient charge as the engine would not start. At the same time, fuel was added to both tanks to their respective tabs. With the new battery installed, the private pilot attempted to start the engine a few times, but she was unsuccessful. Following a few attempts on his own, the CFI was able to start the engine and did not observe anything abnormal. The engine was run for 4 minutes, with the fuel tank switched after one minute. When the ammeter stabilized, the engine was shut down. Following the engine run, a small amount of water was drained from the left-wing fuel sump. The private pilot continued to sump the fuel from the left tank until water was not visible. The right fuel tank was then sumped once, with no water visible in the sample. During taxiing, the engine did not run rough, and the engine gauges indicated normal operating limits. After takeoff from PHNL, the CFI and pilot receiving instruction conducted several maneuvers before practicing touch-and-go landings at PHJR. Fuel tanks were regularly switched throughout the flight. During the sixth takeoff at about 300 ft above ground level, and after the landing gear and flaps were retracted, the airplane stopped climbing; the engine produced a sound as it was in idle and did not respond to throttle movements. At this time, the CFI took control of the airplane and attempted to troubleshoot the engine by manipulating the throttle and switching the fuel tanks; however, he was unsuccessful. The CFI was uncertain about the type of terrain beyond the runway concrete, so he initiated a forced landing with the landing gear in the UP position to prevent the airplane rolling into unknown terrain, and the airplane crashed on the runway. On October 1, 2018, the postaccident examination of the airplane was conducted by a mechanic under the supervision of a Federal Aviation Administration (FAA) inspector. When fuel was drained from the left tank some water was observed. When fuel was drained from the right tank, no water was detected. The fuel collected from the fuel line going into the fuel injectors also contained some water. Lower spark plugs were removed, When the propeller was manually rotation, compression on all cylinders was confirm. Additionally, engine continuity was established the valve train to the accessory section of the engine. The examination revealed no mechanical issues with the engine that would have precluded normal operation. Due to the damaged propeller and logistical concerns, an engine run was not performed.