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City picks firm to buy, manage 12 affordable housing complexes

By Star-Advertiser staff

LAST UPDATED: 02:33 p.m. HST, Jun 20, 2012

The city has selected Honolulu Affordable Housing Partners LLC to buy and manage its 12 affordable housing complexes to relieve the city of more than $6 million in annual management costs.

Mayor Peter Carlisle announced the agreement today at a news conference in his office.

Details, including the purchase price, are being negotiated and a final agreement is expected by the end of next month. The agreement is subject to City Council approval. Under the bidding guidelines, the buyer must agree to lease the land from the city for 65 years and keep all units as affordable housing for the duration of the lease.

City officials, in meetings held last year at each of the complexes, have warned city housing project tenants of probable rent increases if a private owner takes over.

The new owners said they will work with tenants as remodeling and renovations move forward and no residents will be displaced during the process. They expect to spend about $30,000 per unit.

Honolulu Affordable Housing Partners is comprised of Highland Property Development LLC of Auburn, Calif.; Richard Gushman of Honolulu, who has over 40 years of real estate experience in Hawaii and on the mainland; and Stephen Gelber, a Honolulu real estate and tax attorney.

The 12 complexes include 850 apartment units that qualify under the U.S. Department of Housing and Urban Development guidelines for low- and moderate-income households with incomes of 80 percent or less of the median; 189 "gap group" apartments for families with incomes of 80 percent to 120 percent of the median; and 218 market-rate rental units, according to the city.

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EastsideHomies wrote:
So what happens to the personnel that were originally tasked to manage the housing complexes? Do they get to stay on the payroll?
on June 20,2012 | 11:59AM
Tarakian wrote:
You mean the county city workers personnel? I guess they need to fill other county vacant jobs or another job. This is a positive reduction in government workers. For the workers loosing their jobs, I'm sorry and good luck.
on June 20,2012 | 01:52PM
Tarakian wrote:
A positive move in the right direction! Government has shown that it does a bad job for affordable housing. I concur with the Mayor, this time, that letting the private sector take care of affordable housing is the best way to go. However, the private firm needs to be able to make a profit to be viable in order that this endeavor last in the long run. That will mean higher rents etc. Maybe this will force some families to get another job (like most families in Hawaii) or move out to another lower rental unit.
on June 20,2012 | 01:48PM
cojef wrote:
Now the heat is off the State, so more picking on them for the ills on housing. Gotta find something else to nit-pick.
on June 20,2012 | 02:02PM
Canefire wrote:
What was the selection process that picked this firm? Who else were considered but didn't get picked? If the purchased price is still unknown and being negotiated, isn't it premature to release the news that this firm is picked?
on June 20,2012 | 04:28PM
soundofreason wrote:
You're asking THIS question in the same state that is "pouring" rail supports to a rail system that "really isn't" federally funded.....after all. Premature is the way it's done. And it doesn't stop there - ask their wives ;)
on June 20,2012 | 06:24PM
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