Grading work has begun for a 475-home subdivision near the bottom of Makakilo above St. Jude Catholic Church.

Black dust fences were put up along the Makakilo Drive border of the project last week.

The Kahiwelo subdivision is being built in two phases, with the first 180 single-family homes expected to be completed in April 2008, according to Michael T. Jones, president of the Schuler Division of D.R. Horton, which is developing the site.

Six three- and four-bedroom models ranging in size from 1,423- to 2,378-square-feet will be offered on approximately 150 acres stretching to Welo Street, Jones said. Prices will probably start in the $500,000 range, Jones said.

Horton is also developing a three-acre park on the site that will be dedicated to the county for public use.

The property was zoned for residential development in the early 1980s when it was under the control of Finance Realty, Jones said. Horton purchased it about two years ago.

The main entry into Kahiwelo will be off Makakilo Drive and bisect with the existing Palailai Street. Jones said his company will be responsible for putting up a traffic signal at the intersection, as well as other improvements such as restriping for turnout lanes.

There will be an additional entrance on the mauka side of the development off Welo Street.

Kioni Dudley, a member of the Friends of Makakilo and the Makakilo/Kapolei/Honokai Hale Neighborhood Board, said he's worried about traffic at the new Makakilo Drive-Palailai Street intersection.

Traffic going down the hill in the morning is already bad, Dudley said, while afternoon traffic backs up onto the H-1 Freeway off-ramp.

"The number of homes will put about a thousand more cars at the very worst possible place," Dudley said. "Makakilo Drive in the afternoon is so glutted the traffic backs up on the freeway for a mile. It's really a dangerous situation."

Dudley said a tunnel that travels under H-1 Freeway and moves onto Farrington Highway could be used as the main entrance to Kahiwelo.

Jones said Horton officials discussed the issue with Dudley. The tunnel is a drainageway and the developer is now looking at the possibility of it being an emergency access, but not a permanent one, he said.

Traffic along Makakilo Drive may actually be eased by the extension of Palailai Street, Jones said, by offering an alternative for those trying to travel to the eastern side of the hill.

Some residents have criticized the developer for not going before the neighborhood board to inform the public about the project.

Jones said his staff last month gave a presentation of the Kahiwelo project to the Palehua Community Association, comprising those with homes closest to Kahiwelo.

Henry Eng, the city's director of planning and permitting, said Horton is not required to go before the neighborhood board since it requires only administrative approvals from the city.

Horton has developed about 900 homes elsewhere in Makakilo. Meanwhile, it is in the early stages of seeking approvals for the proposed 11,700-home Ho'opili subdivision in 'Ewa.

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