A state board said no on Wednesday to a request by a Kakaako high-rise developer to build a tower filled with rental apartments instead of condominiums after four public hearings at which public testimony largely supported the change.

Board members of the Hawaii Community Development Authority voted 9-0 to reject the request by Howard Hughes Corp. for its planned $200 million tower called 988 Halekauwila.

Hughes Corp. received approval for the tower in 2013 as a condo with 424 units, of which 375 would be reserved for residents with high-moderate incomes. The 375 units satisfied about half of an HCDA affordable-housing requirement tied to the developer’s Ward Village master plan for up to 4,300 units in 22 towers.

The developer instead proposed making the 375 units rental apartments reserved for 15 years for residents with lower incomes than HCDA rules require for condo buyers. But the board expressed concern that the 15-year term wasn’t long enough.

Current HCDA rules specify a 15-year term for such rentals. However, the Ward Village plan was approved under a prior version of the rules that say the term should be a "minimum" of 15 years.

Hughes Corp. vowed to deliver 988 Halekauwila three years earlier as rentals, and touted that rentals would provide lower-cost housing to people with lower incomes compared with condos. But that didn’t sway HCDA’s board.

"I just don’t think their arguments were persuasive to me," said board member Steve Scott. "I think in the long term we are better served by a for-sale project."

The decision came in the face of public testimony that tilted heavily in favor of the developer’s request, including an endorsement from Dennis Oshiro, head of the nonprofit Hawai’i HomeOwnership Center focused on helping people save money to become homeowners.

Bob Nakata, a representative of affordable-housing advocacy group Faith Action for Community Equity, testified three times against the developer’s request then changed his mind Thursday. "We are dropping our opposition," he said.

David Striph, senior vice president in Hawaii for Dallas-based Hughes Corp., declined comment after the hearing but issued a written statement that expressed some frustration and said the company remains dedicated to providing a wide range of housing at Ward Village.

"This new board has stated their intention to listen to the voice of our community, and public testimony was overwhelmingly in support of approving the project for 15 years," he said. "We are disappointed the project was not approved today because our community suffers when the delivery of much-needed affordable housing is slowed down or stopped."

Hughes Corp. said during the hearings, which started in April, that it would scale back the number of moderate-priced condos to 125 to meet the minimum required for its first two luxury towers under construction.

Under HCDA rules, 20 percent of housing must be affordable to residents with moderate incomes as a trade-off for tower projects given higher building densities. For condos, residents may earn no more than 140 percent of Honolulu’s median income. Rentals are reserved for residents earning no more than 100 percent.

Income at 140 percent equates to $85,200 for one person or $121,700 for a family of four. At 100 percent, the comparable limit is $60,850 or $86,900.

The difference in monthly housing costs would be $940 to $1,267 depending on family and unit size, according to Hughes Corp. For instance, a one-bedroom unit would cost a couple $1,739 in rent or $2,679 in a mortgage payment, the company said.

Hughes Corp. said it requested the shift to rentals because of weaker demand for mid-priced condos in Kakaako over the last two years brought on by competing projects that include two towers called 801 South St. that don’t have HCDA restrictions applying to 988 Halekauwila, such as a provision for buyers to share equity with HCDA.

HCDA board members expressed concern that allowing 988 Halekauwila to be built as rentals restricted for 15 years would allow Hughes Corp. to reap a big future gain by either boosting rents to market rates or selling units as condos after 15 years.

Douglas Ing, an attorney representing Hughes Corp., said it was unfair for HCDA’s board to reject the developer’s request or apply what some members suggested should be a 30-year affordability term because other rental projects at a Kamehameha Schools master plan under the same rules were approved with 15-year terms.

Ing said it would be discriminatory to impose a longer term and would be grounds for a legal challenge.

John Whalen, the board’s chairman, said board views changed after a prior board subcommittee recommended that HCDA amend its rules to require a 30-year term for affordable rentals.

David Arakawa, executive director of the Land Use Research Foundation of Hawaii, an organization representing major Hawaii landowners and developers, suggested at an earlier HCDA hearing that it appeared board members want to exact more from Hughes Corp. because the company is profiting from million-dollar condos.

Arakawa said the idea is troubling, and said it’s like the board is saying: "Hey, these guys are making too much money — let’s whack ’em. Let’s see how much we can whack ’em for."

Condo units at one Ward Village tower called Waiea have sold for an average $3.7 million. One unit is priced at $19.8 million, while one prospective buyer of a bigger unit dubbed the "grand penthouse" has claimed it is available for just under $100 million.

Scott Kami, an HCDA board member and official with the state Department of Budget and Finance, said at Wednesday’s meeting that profit by the developer isn’t a bad thing. He also said the board has a fiduciary responsibility to maximize affordable housing.