Tenants of a 40-year-old affordable housing complex downtown celebrated its renewal yesterday with elected officials, local leaders and the nonprofit developer that saved it from being converted into market-rate rentals that would have forced thousands of low-income residents from their homes.

Kukui Gardens with 389 units, down from 857, should be completely renovated by August, said Marian Gushiken with nonprofit developer EAH Housing.

The other segment of the property, which has higher rental rates, is owned by Carmel Partners, which recently renovated its units and renamed them Waena Apartments.

After Kukui Gardens Corp. offered to sell the low-income apartments to upscale developers in 2006, the property was saved when a campaign by tenants, community leaders and elected officials persuaded Carmel Partners to sell half of the property for $72 million to EAH Housing and Devine & Gong of San Francisco.

EAH Housing began renovating the run-down property in 2009, but was delayed by the recession. About $18 million in repairs have been done, including reflooring all the units, adding energy-efficient fixtures, and in many units, replacing appliances, toilets, sinks and bathtubs. Exteriors were painted and greenery added.

Because the renovations came in under cost, the developer plans to use the balance to recoat the parking lot, Gushiken said.

EAH officials held the ceremony Saturday to show appreciation to its 1,500 residents for putting up with the construction, which required them to move into temporary units until their units could be finished.

"It’s been a lot of upheaval for the tenants," Gushiken said. "With a little bit of discomfort, ultimately they have a new community and long-term affordability."

The renovation changed the atmosphere of the housing complex from a concrete setting to more of a garden landscape.

"It looks beautiful," said Kin Tam, 63, a seamstress and 36-year resident. "That’s what we want — green, green, green."

Gov. Neil Abercrombie, who attended the ceremony, said Kukui Gardens’ success shows what can be accomplished when a community works together.

He said he has talked with the chairman of the City Council about adding affordable housing units across the island.

"This is just the beginning," he said, adding that officials will follow the example of Kukui Gardens and "take this kind of model across the whole island."

For Carol Anzai, former president of the Kukui Gardens Residents Association, recalling the work to save the property brought her to tears.

"When it first started, I never thought we would save even half of Kukui Gardens," she said. "We thought we would lose the whole thing."

Though the residents association no longer exists, Anzai remains on the board for EAH, even though she is a resident of Waena Apartments. After living at Kukui Gardens for 38 years, she said she worked on saving Kukui Gardens for the families and senior citizens who needed it.

"I knew it wasn’t for me," she said. "It was for my people, my little community. … My heart is here."