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McCully condo plan raises concerns

Requested variances are "out of character" with the community, some residents say

By Andrew Gomes

LAST UPDATED: 9:04 p.m. HST, Apr 10, 2014

A developer is seeking permission to build a moderate-priced condominium tower in the McCully area to address Oahu's need for affordable housing, though the height and density of the project isn't going over well with some neighborhood residents.

The condo called 'Ohana Hale would be 21 stories with 180 mostly studio and one-bedroom units expected to sell for between about $250,000 and $440,000, according to a draft environmental assessment for the planned tower published this week.

Most of the units would be restricted to buyers earning no more than 120 percent of Honolulu's median annual income, which equates to about $80,000 for a single person or $92,000 for a couple.

Project developer Franco Mola of MJFDevelopment Corp. said in the environmental assessment that 'Ohana Hale has the potential to be a good example of urban infill development providing moderate-priced homes within walking distance to schools, grocery stores, parks and other retail and recreation facilities.

"Most of the recent residential condominium developments in urban Honolulu are in the luxury price range,"the developer said in the assessment. "'Ohana Hale provides more affordable and modest-sized market-rate units to fill the void that is ever-increasing in the urban Honolulu housing market."

However, the McCully-Moiliili Neighborhood Board objected to several variances being sought by Mola for the project, which is on a block bordered by McCully and South King streets where low-rise residential and commercial buildings are the norm.

"It's definitely out of character with the neighborhood,"said Ron Lockwood, neighborhood board chairman. "Everything around it is three-story walk-ups."

The property, which Mola bought last year for $2.6 million, is occupied by a single-family house, a triplex and a two-story apartment building with 14 units.

The building height limit for the area is 150 feet, though Mola is seeking approval for 'Ohana Hale to rise 189 feet and be twice as dense as permitted under county zoning rules.

Mola is seeking the variances and other exemptions that include not paying several county fees totaling about $3 million and not setting the building back from some property lines.

The developer said in the assessment that the exemptions help reduce development costs and unit prices, and that the additional building height would have a "minimal visual impact" toward the Koolau mountains and Diamond Head.

Neighborhood board member Ronald Neff noted during the February meeting that the developer could pursue higher-priced homes with no variances, and suggested that it would be better for the board to support affordable housing, according to meeting minutes.

The board, however, voted 10-1 to support the project without zoning variances. That vote followeda motion to support the project as proposed, which failed with only four affirmative votes.

The board's position does not prevent the developer from moving forward, though it is taken into account by the City Council, which decides whether to approve variance requests.

Mola has applied to develop 'Ohana Hale under state affordable-housing law that allows certain exemptions to state and county requirements for qualified moderate-priced housing projects.

Condo towers built under the law in recent years include Holomua, which rose 70 feet above a 150-foot limit in Pawaa, and Plantation Town Apartments, which rose 45 feet above a 60-foot height limit in Waipahu.

The law requires that at least 51 percent of units in a qualified project be affordable to people earning no more than 140 percent of the median income.

Mola's project proposes providing 60 percent of units under a lower cap, with 86 units affordable to people earning no more than 120 percent of the median income and 22 units affordable to people earning no more than 100 percent of the median income.

Most of those qualified units would be studios with 335 to 387 square feet of living space. Some one-bedroom units with 454 to 498 square feet also would qualify.

Five two-bedroom units with 986 square feet to 1,082 square feet are also part of the project and could be priced between roughly $640,000 and $700,000, according to the assessment.

Monthly maintenance fees are projected to range from $168 to $249 on the studio and one-bedroom units, while parking stalls would cost $75 a month.

Under the affordable-housing law, the Hawaii Housing Finance and Development Corp., a state agency facilitating affordable-housing production, is entitled to share any appreciation in a qualified condo sold by the initial buyer and has the first option to purchase a unit resold within 10 years.

If Mola obtains all necessary approvals, construction is projected to start in February and finish two years later.

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