Star Advertiser: Second phase of low-income rental units in Ewa Beach opens

By Andrew Gomes, Star Advertiser

Hawaii’s need for affordable housing got a bit smaller recently with the opening of a low-income rental complex in Ewa Beach filled with 76 households selected from a list of about 900 applicants.

Kirk Tolai, a 33-year-old emergency medical technician with American Medical Response, was among the fortunate ones selected in a lottery earlier this year that allowed him to rent a three-bedroom unit with his wife and two children for about $1,200 a month.

“Damn, I’m tripping out,” he said. “The cost of living is so high. It’s difficult for families. We were basically living out of my mom and dad’s home in Makakilo before.”

Monthly rents in the community Tolai moved into, called Villages of Moa’e Ku, range from $535 to $1,364 for units with one, two and three bedrooms.

Moa’e Ku homes are reserved for households earning no more than 55 percent of the annual median income in Honolulu, which equates to $42,185 for a couple or $52,690 for a family of four as calculated by the Hawaii Housing Finance and Development Corp. Some units also are reserved for households earning no more than 30 percent of the median income.

Nonprofit developer EAH Housing produced the 76 homes and hosted a grand opening and blessing Friday for the $31 million project that represents the second phase of Moa’e Ku.

A third and final phase with 52 units is projected to start construction next summer.

EAH finished a $30 million first phase with 64 apartments two years ago after selecting tenants from what was then an applicant list of about 300 people that has roughly tripled and today remains at over 800.

“That tells us that there is a real need,” said Kevin Carney, vice president of the Hawaii affiliate of California-based EAH.

“We so wish that we could house them all right this very minute,” added Mary Murtagh, president and CEO of EAH. “It’s a lot of hard work to create these properties.”

Moa’e Ku, which is named for a wind that blows through Ewa Beach, has required an exceptional amount of work — and time — to be realized.

The 192-unit project was envisioned two decades ago as a public-private partnership tied to an ambitious city effort to revitalize the historic Ewa Villages plantation town.

The city bought Ewa Villages from sugar cane plantation owner Amfac/JMB in the early 1990s under a plan that included preserving plantation-worker homes.

New affordable housing was slated for 24 acres known as Area H, and a deal was arranged for Unity House, a local union-affiliated nonprofit organization, to buy the site and build rental homes for former sugar workers and families making less than 80 percent of Honolulu’s median income.

Unity House, however, canceled its plan in 1998 after claiming that the city was providing insufficient financial support. The city offered to sell Area H for $5.7 million and provide Unity House with $1.9 million in federal community development block grant money to help with the purchase.

With Unity House out, the city tentatively selected an affiliate of EAH to pursue the project in 1999. But it took until 2003 to complete the land purchase for $5.9 million, of which $5 million came from city-administered federal block grant funds.

At that time, EAH projected finishing the first phase in 2007. But securing funding through competitive awards took much longer than anticipated. Then financial markets came unglued amid the recession, further inhibiting financing.

Another time-consuming challenge was selling an 8-acre piece of Area H fronting the Ewa Villages Golf Course to a for-profit housing developer to help pay for costly infrastructure. That sale required lengthy city and federal approvals.

EAH couldn’t borrow a lot for the roughly $90 million project because rental income from units wouldn’t be enough to pay off a large debt. As is typical for low-income housing in Hawaii, EAH relied on a mix of government financing that included the state rental housing trust fund, tax-exempt bonds, low-income housing tax credits, federal funds administered by the city in addition to relatively small private loans.

Much of the financing was provided through Hawaii Housing Finance and Development Corp., a state agency facilitating affordable-housing production.

“Moa’e Ku is proof of what can be done when you leverage the strength of the private sector and the public sector to serve communities,” said Craig Hirai, the agency’s director.

Murtagh of EAH added, “Public-private partnership is really essential to getting anything done with (low-income) affordable housing.”

For tenants like Laureanne Olaya, the effort by EAH and the city, state and federal governments was a godsend. The 28-year-old moved into the first phase of Moa’e Ku two years ago with her young daughter, her mother and her father, who has since died.

“We love this place,” she said. “Our neighbors are pretty much like our family.”

Moa’e Ku is laid out in clusters of two-story buildings with each cluster surrounding a landscaped central courtyard with a fenced children’s play area. Apartments feature granite countertops, laminate flooring, a lanai and 621 to 1,051 square feet of living space.

Olaya said her family had a hard time renting a home in Pearl City for $1,600 a month before moving to Moa’e Ku where their rent is $961 for a two-bedroom unit. After her dad died, Olaya said there was some concern the family might not be able to keep up with the rent, though they are managing.

“This place was meant for us,” she said.

Photo: Dennis Oda, Star Advertiser
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