Prospective Buyer Terminates $142M Deal to Acquire City-Owned Affordable Housing

The $142 million leasehold sale of 12 city-owned affordable rental complexes located in various parts of Oahu has been canceled. According to the Honolulu Star-Advertiser, the group of investors that agreed to purchase and manage the properties in the summer of 2012 will not be able to make a $35 million payment to the city by the March 31 deadline.

By Adriana Pop, Associate Editor

The $142 million leasehold sale of 12 city-owned affordable rental complexes located in various parts of Oahu has been canceled.

According to the Honolulu Star-Advertiser, the group of investors that agreed to purchase and manage the properties in the summer of 2012 will not be able to make a $35 million payment to the city by the March 31 deadline. 

In a letter sent on Jan. 23rd, the proposed buyer, Honolulu Affordable Housing Partners LLC (HAHP LLC), informed the city and county of Honolulu that the group would not be able to secure commitments from any investors, lenders or other capital sources by the closing deadline specified in an August 2012 sale agreement.

“We are extremely disappointed that Honolulu Affordable Housing Partners LLC was unable to satisfy the city’s requirement for the seller-financing requested by HAHP LLC and to develop a workable solution in order to close by the deadline,” City Managing Director Ember Shinn said in a news release.

In June 2012, the former Carlisle administration selected the HAHP partners’ proposal from among seven submittals. The city will now move forward with a new request for proposals to secure a buyer for these properties.

In regional news, the Pacific Business News reports that a new low-income rental housing community has recently opened in Wailuku on Maui.

Called Imi Ikena Apartments, the four-story complex at 511 Imi Place offers 28 two- and three-bedroom units for households earning between 30 and 50 percent of the area’s median income. Rents range between $417 and $913, according to EAH Housing, a non-profit affordable housing organization that partnered with Imi Ikena Housing Partners LLC to develop the project.  

Imi Ikena Housing Partners LLC is a joint venture between DBR Development LLC, Horizon Development Consulting LLC and Affordable Housing Specialists LLC.

The project received $9.4 million in proceeds from Low Income Housing Tax Credits granted by the Hawaii Housing Finance & Development Corp., as well as an Affordable Housing Funds award from the county of Maui.

Photo credits: EAH Housing