Maui fire housing losses high for low-income rentals

A state agency is exploring ways to expedite replacement of Maui low-­income rental housing to offset losses from the deadly Aug. 8 Lahaina wildfire.

About 550 homes serving predominantly low-income households were destroyed or rendered uninhabitable by the fire, representing 16% of the estimated 3,500 homes lost or damaged in Lahaina, according to the Hawaii Housing Finance and Development Corp.

The agency, which helps private developers produce low-income housing using state and federal financing, is considering several strategies to replenish inventory serving those who can least afford to live on Maui, where housing costs are among the highest in the state.

Dean Minakami, HHFDC’s interim executive director, told the agency’s board at a recent meeting that a few potential strategies he described as “low-hanging fruit” include dedicating a specific amount of financing to low-income projects on Maui and lending Maui County money to replace damaged infrastructure.

“These are things that are entirely within our control,” he said during the Sept. 14 meeting.

Minakami also said the agency is discussing how it might help developers accelerate several previously planned low-income housing projects on Maui, including two in Kihei, one in Kahului and one that was under construction in Lahaina but suffered only wind and smoke damage.

Other possible strategies being considered by HHFDC involve obtaining more federal financing for low-income housing development on Maui, which would require congressional approval.

Such approval is being sought via requests to Hawaii’s congressional delegation through Gov. Josh Green, according to Minakami, who said other states have been successful in obtaining such financing increases approved by Congress after losses from natural disasters.

“There is precedent for these actions,” he told the agency’s board.

All the strategies being considered by HHFDC aim to produce long-term affordable housing largely for low-income households, including seniors, that would replace what amounted to one out of six homes destroyed or damaged by the fire.

This inventory served tenants who in some cases earned no more than $24,330 a year for a single person or $34,740 for a family of four, which equates to 30% of the median annual income in Maui County. Monthly rent for some of these units could be less than $1,000 for a four-bedroom apartment and under $600 for a studio.

The 547 predominately low-income rentals affected were at 12 properties in Lahaina, according to HHFDC.

The largest property on the list was Front Street Apartments with 142 units. According to the agency, the private owner of the project on state land intends to rebuild pending an insurance claim.

The Hawaii Public Housing Authority had two properties affected by the fire: Piilani Homes with 42 units and David Malo Circle with 18 apartments.

A Maui nonprofit, Hale Mahaolu, managed five low-income housing projects listed by HHFDC as being destroyed or left uninhabitable by the fire. The properties were the 112-unit Lahaina Surf, a pair of 20-unit projects owned by the county called Komohana Hale and Crossroads, the 35-unit Hale Mahaolu Eono for older residents who can live independently, and a separate Hale Mahaolu Eono property with five homes.

The loss of about 190 units for Hale Mahaolu is a significant portion of 1,300 affordable units the nonprofit owned or managed on the island before the fire.

“As part of the Maui community, we continue to grieve those who were lost and work to support our tenants,” the organization said in a statement. “As far as Hale Mahaolu’s properties are concerned, we hope to replace what was lost and continue to be committed to providing affordable housing in Lahaina, and throughout Maui County.”

Another low-income housing project loss was the 89-unit Kaiaulu o Kupuohi mid-rise that opened late last year. It was completely destroyed. Monthly rent at the property was as low as $529 for some one-bedroom units and topped out at $1,578 for some three-bedroom units.

Weinberg Court, a 62-unit property, also was on the list along with two homes owned by HHFDC that were vacant and leased to the state Department of Health.

Residents in some of the properties lost to the fire were among 97 people known to have been killed by the blaze that was quickly driven over Lahaina by gale-force winds.

HHFDC typically helps private developers finance low-income housing construction primarily with state and federal tax credits supplemented by tax-free state bond financing and low-interest loans.

Minakami suggested that the agency could reserve 20% or 30% of its available tax credit financing for Maui projects. He also said the agency is discussing how it might assist developers with expediting delivery of already planned projects on Maui.

One of these is Kaiaulu o Kuku‘ia, a $163 million project with 200 apartments that broke ground last year in Lahaina and was damaged by smoke and wind, though not severely, according to Minakami.

Other planned projects include a 90-unit complex planned in Kihei called Hale o Piikea where construction was projected to begin by the end of this year and be finished in early 2025, and a 117-unit complex in Kihei called Liloa Hale where construction had been delayed from a previously expected start earlier this year.

A fourth planned project, a 303-unit complex called Kahului Civic Center, received financing approvals from HHFDC’s board at the recent meeting. Construction is projected to begin for this $193 million project in early 2027 and finish in 2029.

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Lahaina low-income housing losses

The 547 predominately low-income rental apartment units that were destroyed or damaged by the Aug. 8 Lahaina wildfire are:

>> Front Street Apartments, 142 units

>> Lahaina Surf, 112 units

>> Kaiaulu o Kupuohi, 89 units

>> Weinberg Court, 62 units

>> Piilani Homes, 42 units

>> Hale Mahaolu Eono, 35 units

>> Komohana Hale, 20 units

>> Crossroads, 20 units

>> David Malo Circle, 18 units

>> Hale Mahaolu Eono 5, 5 units

>> 34 Kulalani St., 1 unit

>> 1351 Kaeo St., 1 unit

Source: Hawaii Housing Finance and Development Corp.