Hawaii State Federal Credit Union plans to spend $38 million and a year transforming a downtown Honolulu office building into a new branch and headquarters to consolidate more than 250 employees from office space at multiple sites.

The credit union announced its renovation plan Monday, saying the Melim Building at 333 Queen St. will replace its more than 40-year-old headquarters at 560 Halekauwila St. in Kakaako.

Hawaii State FCU bought the 10-story Melim Building, which includes an adjacent 350-stall parking garage, a year ago for $23 million, according to property records.

Andrew Rosen, president and CEO of the organization, said the move will improve operations and accommodate growth of the business near its core field of membership in the downtown and Honolulu civic center area.

“We view this building as an investment in the future of the credit union, and the timing of the renovation project is perfect because we remain financially strong and have high liquidity and cash reserves,” he said in a statement. “With the new headquarters we can bring all of our staff together in one location to improve collaboration and create operational efficiencies and reduce expenses, enabling us to continue our rapid growth and provide new and improved member services and experiences.”

Membership in the credit union is open to active and retired employees of the state of Hawaii, City and County of Honolulu and Maui County. In addition, employees and members of more than 300 local organizations and businesses can qualify individuals to become members.

Work on the Melim Building, which dates to 1960, is slated to include an extensive demolition and renovation of interior spaces as well as some improvements to the exterior facade. Hiarchy LLP is the architect for the project, and the general contractor is Nordic PCL Construction Inc.