Lawmakers approved $25 million in bond financing to preserve about 800 affordable apartments at the Kukui Gardens complex near Chinatown.

A House and Senate conference committee voted unanimously yesterday to approve the bond deal. The financing plan must be approved by the full Legislature next week before going to Gov. Linda Lingle for signing.

"This is a huge step toward preserving affordable housing for working class people," said state Rep. Karl Rhoads, D-28 (Palama, Downtown, Chinatown), who was a member of the House conference committee.

"Twenty-five million dollars is a lot of money but it's a lot less than what it would cost to start over and build the same amount of affordable housing."

The $25 million is just half of the money needed to finance the deal. The state must come back to the Legislature next year for an additional $26 million in financing, Rhoads said.

"This solution is a remarkable example of bipartisan cooperation," said the Rev. Bob Nakata, a former state lawmaker who worked with tenants to save the property.

"The effort to save the property drew support from every branch of the state government. ... Everyone put their heads together to make this work."

The fate of 857-unit Kukui Gardens, one of the state's largest affordable housing projects with over 2,500 residents, has been in question since the nonprofit owner, Kukui Gardens Corp., put the apartment complex up for sale in January 2006.

In April 2006, Kukui Gardens Corp. announced that it was selling the property to Carmel Partners for about $130 million.

Public outcry over the sale to Carmel prompted the Legislature to approve a measure last year giving Gov. Linda Lingle the power to use the state's condemnation process to acquire Kukui Gardens. Lingle signed the bill into law in July.

In a compromise, Carmel agreed in January to split the complex in half, with one half of the ownership going to the state to develop affordable housing. Carmel retains the other half to build market-priced homes and office and retail space.

Reach Rick Daysog at rdaysog@honoluluadvertiser.com.