Kapolei housing project sets ‘lofty’ rental targets

A new and unique community that includes low-income rental apartments, an air-conditioned gym, a pool with cabanas and a lounge where residents can use free Wi-Fi and big-screen TVs is coming to life in the urban core of Kapolei.

The developer of the $150 million project called Kapolei Lofts hosted a ceremony Thursday to celebrate the recent arrival of the first residents in the rental complex slated to have 499 apartments by next summer.

“We’ve got a long way to go, but the market has responded,” said Jon Wallenstrom, president of Kapolei Lofts’ developer, Forest City Hawaii. “The reception’s been great.”

Jayson and Heather Sam Fong, a couple with jobs at Aulani resort at Ko Olina, decided to put off trying to buy a home after they saw Kapolei Lofts and its offering of low-, moderate- and market-priced apartments with ceiling heights from nine to 13 feet, stainless-steel appliances, central air conditioning, electric vehicle charging stations and a car-share program.

“We fell in love with it,” said Heather Sam Fong, 37.

Jayson Sam Fong, 36, picked up an application in June and camped on the sidewalk for 24 hours outside the Kapolei Lofts rental office to submit it early enough to pick a unit in the first building. “Moving in was nice,” he said.

The Sam Fongs and several other residents moved in Aug. 20.

An initial building with 34 units is open, and Forest City continues to work through what was an initial batch of 250 applications. Another 70 homes are scheduled to be ready for occupancy by Oct. 31, and all 499 units in the collection of three-story buildings are anticipated to be complete by next summer.

Monthly rents range from $1,217 to $3,500 for units with one to three bedrooms.

Of the 499 units, 100 are reserved for households that earn no more than 80 percent of the median income in Honolulu, which equates to $61,360 for a couple and $76,640 for a family of four. Rental rates for these units are $1,217 for one-bedroom units and $1,444 for two-bedroom units.

Another 199 homes will be rented at market rates with no tenant income restrictions. These rates can change daily based on supply and demand, and on Thursday included one-bedroom units for $2,350 to $2,600, two-bedroom units for $2,600 to $3,000 and three-bedroom units for $3,400 to $3,500.

The remaining 200 homes are available at market rates but come with one month free rent and are reserved for households that earn no more than 140 percent of the median income, which equates to $107,380 for a couple and $134,120 for a family of four.

Unit sizes vary. One-bedroom units range from 402 to 753 square feet. Two-bedroom units range from 799 to 1,040 square feet. Three-bedroom units are 1,293 square feet.

Patrick and Jennifer DeMello sold their home at Oceanpointe on the Ewa plain to move to Kapolei Lofts.

“The four-bedroom, three-bath home was just too big,” said Patrick DeMello, 48, a federal firefighter.

“And the mortgage was crazy,” his wife added.

The DeMellos have two grown sons — one who moved to the mainland for work and the other getting ready to go to college on the mainland — so they decided to move somewhere with nice amenities and a better work commute.

Jennifer DeMello works in security for the federal government and can walk to work from Kapolei Lofts. Recently the couple walked to a restaurant and a movie. “It was great,” she said.

Forest City describes Kapolei Lofts as the first new rental housing project built in Hawaii with resort-style amenities and apartments for households earning both low and high incomes.

“Nobody’s done this before (in Hawaii),” Wallenstrom said. “This is the first of its kind.”

Gov. David Ige, who attended the ceremony, which included a Hawaiian blessing and hula performance, commended the local affiliate of Ohio-based Forest City for providing new homes for residents at such a broad spectrum of rents.

Mayor Kirk Caldwell said the project reminded him of a place he lived in 1978 in Virginia after landing a job with the late U.S. Sen. Daniel Inouye in Washington, D.C. “It was a blast to live in,” the mayor said, recalling that residents were mainly young professionals who couldn’t afford living in Washington. He also said parties at the pool were a lot of fun.

Caldwell said Hawaii needs more projects like Kapolei Lofts, given that 440,000 rental apartments were built in the U.S. last year but none in this state.

Wallenstrom said financing Kapolei Lofts was difficult because of the high development cost and range of rents.

One key to pulling it off, Wallenstrom said, was having a 2.5-megawatt photovoltaic system to reduce Forest City’s operating expenses. Another key was having a lot of financial partners, including an affiliate of James Campbell Co. that is leasing the land to Forest City and contributed $27 million for development, PNC Bank National Association, American Savings Bank, Bank of Hawaii, First Hawaiian Bank and Central Pacific Bank. The Hawaii Housing Finance and Development Corp., a state agency that facilitates affordable-housing development, also helped finance the project.