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The Honolulu Advertiser
Posted on: Wednesday, April 5, 2006

Kukui residents grill board

By Gordon Y.K. Pang
Advertiser Staff Writer

Members of the Kukui Gardens Corp. and the Clarence Ching Foundation listened last night as residents voiced concerns.

JEFF WIDENER | The Honolulu Advertiser

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Residents of Kukui Gardens and concerned citizens listened last night and asked sometimes pointed questions at a town meeting to discuss the proposed sale of the affordable-housing apartments.

JEFF WIDENER | The Honolulu Advertiser

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Owners of the 857-unit Kukui Gardens apartment complex said the prospective owner wants to keep the project affordable, but many of the 250 residents at a community meeting last night appeared to be still skeptical.

R. Stevens Gillie, a real-estate consultant for the Kukui Gardens Corp., said the potential buyer — whom the owners have declined to identify, citing a confidentiality agreement — "is willing to discuss and consider long-term options beyond 2011 and will be available to meet with tenants and elected officials at the proper time."

But Kelly Arrington, a 23-year resident of Kukui Gardens, was not satisfied. "Looking into something is not a confirmation," she said. "I'm not buying it."

Tania Chan, 17, whose family has lived in the apartments for more than a decade, was dubious about when the new owner may meet with the tenants. "Later on can be 20 years from now," Chan said.

Gillie said the prospective owners would likely meet with tenants after it completes its due-diligence period, likely within 30 days. The potential buyer "believes the tenant profile is good and does not want to change that." If the sale goes through, he said, the buyer will consider accepting government housing vouchers that would allow tenants to continue renting the units at affordable rates.

Kukui Gardens is an affordable-housing complex just outside Chinatown. Residents became concerned about the future of the complex when owners said they wanted to sell the property late last year.

Kukui Garden rents must meet affordability guidelines set by the U.S. Department of Housing and Urban Development through 2011 as a result of a loan agreement reached between the developer and HUD. HUD officials, however, say they have no say over what happens to rents after that.

Most of the tenants are immigrants, elderly and on fixed incomes. Their major worry is that a sale will result in redevelopment of the area or rent increases so large that they would have to leave.

The Kukui Gardens Corp. was established by the late developer Clarence T.C. Ching to manage and maintain the apartment complex. The board of the corporation consists of representatives of the Ching foundation, St. Louis School, Chaminade University of Honolulu and St. Francis Healthcare System of Hawaii.

Last night's sometimes rowdy meeting got most emotional when Sylvia Iulio, a six-year resident, questioned board president Lawrence Ching about why he and his brother, Wallace, disagree on the sale.

Lawrence Ching said it was his father's wish to sell off Kukui Gardens at the end of the 40-year period because "he wanted to help all the other people of Hawai'i ... in order to continue his legacy."

Iulio shot back: "Your father wanted (Kukui Gardens) affordable — for the Chinese, the Koreans, the Hawaiians to live. Where are we supposed to go? You answer that."

Proceeds from the sale of the project would go to the foundation. But because board members of both the corporation and the foundation are tied to the three Catholic institutions, many believe they will benefit most.

According to a statement issued Monday by the foundation, no decision has been made on where the proceeds would go. "The foundation has no limited or specific purpose or objective," the statement said. It noted, however, that there are guidelines trustees are to consider when distributing funds from the trust.

Ching echoed that sentiment last night. All three Catholic organizations, he said, "will have to stand in line like everybody else."

Ching said the sale will be in the best interest of tenants because the corporation is out of money to make necessary repairs.

Earlier in the day, the corporation angered leaders of the Kukui Gardens Community Association when they were barred from participating in a scheduled meeting between corporation directors and leaders of Faith Action for Community Equity, which is helping tenants fight the sale.

State lawmakers are seeking to stop the sale. Legislation is advancing that would allow the state to use its powers of eminent domain to condemn the property, essentially forcing the sale to the state at a price to be determined by either appraisers or a judge. Another bill moving through the Legislature would place the entire 19.5-acre project in a special district with severe restrictions on what could be done there.

Reach Gordon Y.K. Pang at gpang@honoluluadvertiser.com.