HCDA approves 492-unit Moana Vista condo

The developer agrees to set aside 124 units as affordable apartments, as well as parking

The state Hawaii Community Development Authority approved a high-rise condominium builder's development permit yesterday in exchange for a higher proportion of affordable rentals and future parking spaces.

The HCDA approved a planned development permit for KC Rainbow Development LLC to build its 46-story Moana Vista tower at 1015 Kapiolani Blvd.

In exchange, KC Rainbow agreed to set aside 124 units as affordable rentals, as well as between 100 to 200 parking stalls that would be sold to the authority for $5.6 million.

The state agency would be able to rent out the stalls to the public on a monthly, hourly or daily basis.

"Parking is a great need, obviously, and we would be delivering on a need as well as being able to cover our expenses," said HCDA's executive director, Daniel Dinell.

While plans for the 492-unit tower on Kapiolani Boulevard will go forward, plans for another part of the project across the street, at 1025 Waimanu St., are still up in the air.

Initial plans were to develop the Waimanu Street site -- referred to as parcel 40 -- into a three-story parking structure with two stories of residential units above it. Now KC Rainbow is starting from scratch on that parcel. It has until March 31 of next year to come back to the HCDA with plans.

Parcel 40, about 30,000 square feet, is now a parking lot for business owners in the area.

At yesterday's meeting, the HCDA board also gave Dinell the authority to approve the new plans for parcel 40 at a later date.

"Overall, we're pleased to be able to move forward with the tower, and we have additional time to work out plans for lot 40," said Allen Leong, KC Rainbow's director of operations. "We will commit to providing 124 units, even if it means we have to take 24 market units from the project."

Leong said that means KC Rainbow will provide more than the 20 percent requirement set aside for "affordable housing." The 24 units, he estimated, are worth about $12 million at market rates.

In December 2005, HCDA approved plans for KC Rainbow's Moana Vista project, which at the time had joint development agreements in place with its neighbors Public Storage Inc. and Obun Hawaii Inc.

The joint development agreements allowed KC Rainbow to add more square footage to its project. But Obun Hawaii, a printing and publishing company, pulled out of the deal earlier this year.

With Obun Hawaii as a joint development partner, KC Rainbow originally planned 520 residential units, with 124 set aside as rentals. Without Obun, KC Rainbow said it wanted to subtract 24 rentals from the project.

But at yesterday's meeting, KC Rainbow committed once again to 124 affordable rentals for the project. Public Storage remains a development partner in the project.

Leong said with enough density, KC Rainbow could conceivably build a 200-foot tower at the Waimanu Street site, but won't likely do so. If there was a strong downturn in the condominium market, he said, KC Rainbow also could decide not to build any residential units there.

Leong said he is negotiating with other potential joint development partners for the lot.

"We have some good leads," he said. "We're still talking to people."