The anatomy of a land development: how a housing proposal in Waiehu came about
It is almost universally agreed that Maui is in dire need of more affordable housing.
The Waiehu-based Hale Mahalou Ke Kahua initiative promises an ambitious solution to an urgent need.
How does such a project materialize? According to Mohannad H. Mohanna, director and president of the Highridge Costa development company, it is built on a series of relationships and multiple interconnected actors.
So in other words, this is how sausage is made.
“Like many of our other communities elsewhere, Hale Mahaolu Ke Kahua came together as a result of various relationships we have established in Maui County, starting with our first project in Kīhei, Līloa Hale, on land owned by Hope Chapel, ”he said.
Hope Chapel is an interfaith Christian church with multiple ministries and was already aware of the need for more affordable housing in the area.
The Waiehu project, a partnership between California-based Highridge Costa and Maui Economic Opportunity, will consist of 120 multi-family residential units, spread across 13 two-story buildings, including 28 one-bedroom units, 60 two-bedroom units and 32 three-bedroom units. rooms, as well as a 3,477 square foot non-profit building, a 3,231 square foot lodge, landscaping and related improvements.
It will span 11.5 acres with an estimated cost of $ 33.5 million.
A total of 264 parking spaces and two loading spaces will also be provided. Access to the project site is provided via three driveway entrances from the Kahekili Expressway.
According to Mohanna, Highridge Costa was introduced to the leaders of Hope Chapel by John Patterson of JPI Realty Services who attends the chapel.
Mohanna said Patterson also introduced Grant Chun, former general manager of Maui County and current executive director of Hale Mahaolu. In addition to managing approximately 1,100 affordable housing units in Maui County, Hale Mahaolu also provides meals, personal care services and housing advice.
In turn, Chun introduced Highridge Costa to Debbie Cabebe, CEO of Maui Economic Opportunity.
“Debbie told us about the MEO site held at the time in Waiehu, which they had not been able to develop on their own,” said Mohanna. “Considering MEO’s mission and service to the community, we thought it was a natural partnership with Highridge Costa and agreed to go ahead in an attempt to convert the site into affordable housing. “
MEO and Highridge Costa are seeking expedited county approval for the project which would be rented out to adults of all ages earning 60% or less of the area’s median income, which is $ 57,540 or less by government guidelines. county of 2021.
In addition to owning the Ke Kahua land (and which will be leased to Highridge Costa), MEO will have its own on-site community center to serve not only the residents who live there, but the surrounding community as well.
Additionally, Hale Mahaolu will manage Ke Kahua on behalf of Highridge Costa, which has developed several similar projects in 33 states and Puerto Rico since its inception in 1995.
According to Linda Munsell, deputy director of the Department of Housing and Human Affairs, “the county is not a partner in the project. The role of the county is to be the receiving agency for their environmental assessment and eventually to work with them on their rights and zoning up to Chapter 2.97 if the project goes ahead.
The Residential Workforce Housing Policy of Chapter 2.97 was established by the County of Maui to encourage developers to build timely affordable housing for residents, although the county council can certainly require that the land is either truly vacant or request various modifications before issuing approvals.
According to Mohanna, “No broker was involved in the vacant land for this transaction, which had already been given to MEO 16 years ago, and will be leased to Highridge Costa at $ 1 per year for 75 years. Highridge Costa and MEO have chosen to join forces as they both bring different types of service and strength to the community.
As part of the development, Highridge Costa will also fund approximately $ 2.5 million for infrastructure and utility improvements along the Kahekili Expressway and Waiehu Beach Road.
He said projects built by Highridge Costa are funded by tax credits and affordable housing bonds sold to investors, as well as the State Rental Housing Revolving Fund, better known as RHRF. .
When will construction start and are there concerns about a shortage of workers and supply chain failures?
“Plans are for construction to begin in the third or fourth quarter of 2023,” Mohanna said. “The reason for the timeline by then relates to the process of submitting for funding through the Hawaii Housing Finance Development Fund. From the once-a-year request in February, it can take another year to get approval for these limited funds, for which the demand often exceeds supply. Once approval is received, it takes more time to plan and start construction.
Mohanna said there were no obstacles in the way. “Our legal consultants, virtually all affordable housing projects seek this ‘fast-track’ process, which allows certain exemptions and reduces the typical lengthy review / approval process (especially since affordable housing has been identified as most needed in Maui County). “
Highridge’s attorneys said title to the property was not an issue. MEO has proper title to the land, and the deeds and previous county subdivision of the property confirm this.
Mohanna said, “People identifying themselves as the heirs of Pehuino ‘Ohana have made it clear that they claim interest in LCA (Land Commission Award) 3386 only and have never been part of the MEO property. This too is confirmed by historical acts, LCA awards and county records. “
He said if Highridge Costa does not receive approval in the next funding round, then construction will be delayed until funding is received, which may take at least another year. Historically, Mohanned has said that Highridge Costa has been very successful in receiving funds for its projects over the years, mainly due to the quality of its applications, closely monitoring costs and creating communities that cater to the biggest needs.
“If we were to start construction today, then, yes, the supply chain and labor shortages could be an issue. However, we are fully confident that these challenges will be resolved by the time we begin construction in the second half of 2023. Mohanna said Highridge Costa has partnered with a union contractor, Hawaiian Dredging Construction Co. (HDCC) , for each of his new projects on O’ahu and Maui for several reasons. “In addition to having close relationships with subcontractors throughout the Hawaiian Islands, HDCC also provides significant input on design choices and planning options in order to control costs. “
According to Hawai’i State Business Registration, Department of Commerce and Consumer Affairs, Waiehu Housing LLC. was registered on January 11, 2021 under the auspices of Highridge Costa.
Monte Heaton is the project manager of this entity. According to a published report, the company’s founder and CEO, Michael Costa, said the company has completed 29,000 units and approximately 290 communities in its 25 years of operation.