The University of Hawaii at Hilo wants to lower rental rates in its least-filled student dormitory next semester and raise rates in its most sought-after residence hall to better manage demand and expenses.

UH-Hilo received preliminary approval Wednesday to cut its student housing rate by $709 — or 18 percent — next semester for accommodations in a suite-style dormitory that has sat less than half full the past two years. Officials said the move is part of a strategy to attract more residents to the 5-year-old Hale Alahonua residence hall, where students paid $3,859 for the fall semester.

But the price break would be followed by 5 percent annual increases the following two years.

Under the plan presented Wednesday to the Board of Regents’ Budget and Finance Committee, the rental rate for Hale Alahonua would drop to $3,150 per bed in the fall before increasing to $3,308 next fall and to $3,473 in fall 2019.

Since the 300-bed dorm was added to Hilo’s student housing inventory in 2013, occupancy has ranged from a high of 67 percent in fall 2014 to a low of 39 percent the following year. This fall, the dorm was 51 percent empty, with 152 vacant beds.

“It is less than ideal,” Farrah-Marie Gomes, UH-Hilo’s vice chancellor for student affairs, told the committee.

Some regents questioned whether a price cut alone would lead to increased occupancy.

“Is there a sufficient number of students who exist who would want to live in dormitories so that you can expand the student population? Is just reducing the price going to expand the clientele?” asked regent Simeon Acoba.

UH-Hilo Chancellor Donald Straney said a student housing survey administered last month found that pricing was the No. 1 reason students chose not to live on campus, with 62 percent of students saying it was too expensive.

He added that the price reduction would be coupled with efforts to better market the building and improve residence hall programming to attract more students. The university is currently recruiting for a full-time associate director of residence life to help oversee the effort.

State Sen. Kaiali‘i Kahele (D, Hilo) called the move a good first step, but suggested the lower rate stand for longer than a year.

“Lowering the rates to stay there is definitely a good idea, but starting to raise it back up in such a short period of time doesn’t give you the opportunity to see if that rate decrease really has an effect,” Kahele told the Honolulu Star-Advertiser. “The housing occupancy needs to stabilize itself first. … I really think that if we’re going to lower the rate, it should be for five years.”

Kahele said that price is just one barrier to filling the Hale Alahonua dorm.

He secured $3 million in the state’s capital improvements budget earlier this year for air conditioning in response to complaints from students that the rooms are too hot. But, Kahele said, the university wants to first install solar panels to offset the projected increased energy use.

The building’s location on campus is also a deterrent, he said. It was built away from the other four residence halls as part of a plan to eventually develop that part of the campus into a university village with restaurants and retail options. But those plans have stalled, leaving students somewhat isolated and lacking dedicated food service in the building.

UH-Hilo officials said the school’s food service contractor is in early discussions to provide a dinner delivery service to Hale Alahonua residents.

The housing rates proposal also calls for raising rates by 5 percent next semester for UH-Hilo’s only apartment-style dormitory, the 205-bed Hale Ikena, which has a wait list of more than 100 students on average each semester.

Under the plan, the double-occupancy rate for a one-bedroom apartment would increase by $161 to $3,377 in the fall, while the single-occupancy rate would go up by $273 to $5,740 for the semester in Hale Ikena.

Rates for the remaining three residence halls would hold flat through next year, before increasing by 5 percent annually in fall 2018 and fall 2019. At the end of the three-year plan, the university estimates its room rental revenues will increase by 23 percent, or by $764,000, in 2019-20 over current levels.

The regents’ budget committee voted to recommend the proposal to the full board for approval.