HONOLULU (HawaiiNewsNow) - The Hawaii Community Development Authority is looking at implementing more stringent regulations for developers as a means of creating more affordable housing. The HCDA is drafting language that it will begin to debate next month.
The Howard Hughes Corporation is one of the largest landowners in Kakaako. Ae'o, Howard Hughes' latest retail & residential project in Kaakako is scheduled for completion in 2018. With condos starting in the low $400-thousand dollar range...some of the 466 dwellings are considered affordable housing by Hawaii standards. But adding to the inventory won't be easy.
"Land costs are high. Construction costs are higher here because literally everything needs to be shipped in across the ocean from the mainland." said David Striph, Senior Vice President for the Howard Hughes Corporation. "So it obviously makes it much more difficult to make things pencil here"
The only way Howard Hughes Corporation can build affordable housing in their neighborhoods is to pass the cost on to someone else.
"The higher end stuff really subsidizes the affordable for us," said Striph. "We couldn't build it and make money. You lose money building it but the market rate allows you to do it. It essentially subsidizes it."
The problem is all too familiar at Hawaii Community Development Association. So the HCDA needs to find ways to keep developer costs down.
"Ultimately we have to have control over the land prices," said HCDA Board member John Wayland. "That means we need to have land that is entitled to the state or city or some non profit organization that will manage the affordable housing."
But even that is likely to come at a cost.