The owner of the Diamond Head Denny’s, under construction at 2538 Kuhio Ave., will open without a liquor license.

The Honolulu Liquor Commission approved a request Thursday from Denny’s franchise owner Medhat Bechay to withdraw his application for a restaurant general liquor license. His decision to withdraw the license followed considerable pushback from neighbors who said they were opposed to alcohol service at the restaurant, adjacent to President Thomas Jefferson Elementary School. Some also were concerned that alcohol serv­ice would exacerbate the neighborhood’s problems with loitering.

Thursday’s hearing was the third for Bechay, who originally applied for a 6 a.m.-to-2 a.m. liquor license but amended it once to inside sales of beer and wine between 11:30 a.m. and 10 p.m. He also agreed to supply a security plan and keep a bar out of the restaurant, which sits on land owned by former First Hawaiian Bank CEO Don Horner.

While the application was supported by the Hawaii Hotel &Lodging Association and the Waikiki Improvement Association, even Bechay’s concessions weren’t enough to appease everyone. The opposition gathered 118 signatures but fell short of the threshold needed for an automatic denial. For that they needed 50 percent plus one of the owners, lessees of parcels and registered voters within 500 feet of the project. They garnered just over 7 percent of owners and lessees and nearly 9 percent of registered voters.

Anna Hirai, assistant Liquor Commission administrator, said a denial would have required the applicant to wait a year before reapplying, but applicants can immediately reapply following withdrawal of an application provided they show that circumstances that led to the withdrawal have changed.

Opponent Mela Kealoha- Lindsey thanked Bechay for withdrawing his application but said she’d return if he reapplied.

“It’s just too close to Jefferson Elementary. I appeal to you to think of our keiki,” Kealoha-Lindsey said.

Retired Lehua Elementary Principal Fay Toyama cautioned the commission about allowing a liquor license near a school. Toyama said a bar with a cabaret license near her Pearl City school had interfered with learning.

“Students and parents living in the area couldn’t sleep because of the noise. They witnessed sex acts and fights on top of cars and in the parking lots and streets,” she said.

Bechay said Thursday that he was not planning to reapply “at this moment” and was instead “focused on hiring 75 staff members” for the restaurant, which is slated to open in April or May.

But the commission’s unanimous decision to support the withdrawal gives him the right to revisit the contentious topic anytime. That’s unacceptable to some members of the opposition who felt that the public wasn’t given due process.

A strong objector, Curtis Crabbe, said Bechay previously made a motion to withdraw his application Jan. 11 but that the commission elected to defer it.

“I think deferring it was an unlawful act,” Crabbe said.

Rachel Linden argued that the liquor license had not been discussed at the Waikiki Neighborhood Board, whose chairman told her Tuesday night that he could not locate a copy of the applicant’s notice. Linden, who brought a box of returned mail to the hearing, also said that the applicant provided an incorrect contact list.

“Public outreach costs thousands of dollars, and false statements have injured my ability to communicate. … The public has been injured because of this,” Linden said.

Honolulu Liquor Commission Chairman Joseph V. O’Donnell told Linden and Crabbe that they could go to an administrative judge to seek relief but that the commission “was only here to act on the agenda item.”