Bishop urges look at second Kukui plan
A California firm says Kukui Gardens units will remain affordable
A consultant who has proposed a plan to keep an 857-unit complex affordable said she is pleased with a letter written by the bishop of the Catholic Diocese of Honolulu that urges owners to consider her offer.
"We feel like he's a very important ally and one that can be an effective ally in our quest to keep Kukui Gardens affordable," said Chanu Lee, senior associate of Devine & Gong, which has presented a second plan to purchase Kukui Gardens and keep it affordable. Her San Francisco firm claims it has preserved and developed more than 10,000 affordable-housing units throughout the country.
"We're hoping that his message has gotten across to the Kukui Gardens' board of directors," Lee said. She plans to call board members today to press for a meeting to discuss her proposal.
Honolulu Bishop Larry Silva sent the letter to some board members of Kukui Gardens Corp. who are also part of Catholic organizations. In that letter, he asked them to reconsider their decision to sell the complex to Carmel Partners Inc. for $130 million.
"The moral imperative of reconsidering this sale is the highest priority," Silva said in the Oct. 26 letter.
Silva sent the letter after reading about Devine & Gong's offer.
Lee has said she has a commitment of $80 million from a mortgage lender, Capmark, as well as $20 million from a tax credit investor, Enterprise Community Investments, Inc., to purchase Kukui Gardens and continue to operate it as a nonprofit.
"In light of the new development, I urge you to reconsider your decision to sell Kukui Gardens to Carmel Properties," Silva wrote.
"I realize there is no guarantee that negotiating with this new potential purchasing team would ultimately result in the desired outcome of preserving this valuable affordable-housing stock for our community, but I urge you to diligently look into the offer. It seems like the morally correct thing to do, since an entity willing to consider purchasing the property and maintaining its affordability has now emerged," he wrote.
The diocese does not play a role in the daily operations of the Catholic organizations represented on the Kukui Gardens board and does not have access to information involving the pending sale to Carmel Partners, he wrote.
Nevertheless, Silva's support is welcomed by residents.
"I'm more hopeful than ever," said Carol Anzai, president of the Kukui Gardens Association.
"I think he has a lot of influence on Kukui Gardens and the Kukui Gardens' executive board," Anzai said.
The sale to Carmel Partners has yet to be approved by the U.S. Department of Housing and Urban Development. HUD has oversight of the complex until 2011, the year Kukui Gardens Corp.'s loan to pay off the mortgage expires.
In response to the letter, Keith DeMello issued a written statement on behalf of Kukui Gardens Corp.
"Kukui Gardens will continue to seek pre-payment to pay off existing loans. The pre-payment proposal includes a use agreement that, if approved, will ensure that Kukui Gardens stays under HUD oversight until May 2011."
It further stated: "Like Bishop Silva, Kukui Gardens also believes that the best interests of the tenants and the common good of the community are best served by the values of clarity and charity. We will continue to promote the dissemination of accurate information and respectful discussion as all segments of the community work together toward the best possible outcome for Kukui Gardens and its tenants."
A spokeswoman for Carmel Partners declined to comment on the letter, saying it is between Silva and Kukui Gardens Corp.
Chris Beda, managing partner of Carmel Partners, had said that they are committed to keeping the complex affordable through 2011.