City officials say they have started acquiring private properties to create affordable housing and transit-oriented development in and around the city-owned Iwilei Center next to Dillingham Boulevard.
TOD projects also will be near the planned Kuwili Skyline station — on the 530 block of Kaaahi Street — which will be part of the third segment of the city’s over-$10 billion rail line, expected to be open to the public by 2031.
These Iwilei sites — just steps away from each other — are ripe for redevelopment, city officials say.
To that end the city Department of Design and Construction, in partnership with the Department of Land Management, and the Mayor’s Office of Housing stated they’ve begun reaching out to property owners along Kaaahi Street to acquire additional parcels to allow these new projects to take shape.
“Acquisition of these additional parcels of land is necessary to advance its master planning efforts for the Kuwili Station TOD Redevelopment Area by enabling the redevelopment of key blocks into new affordable housing, infrastructure improvements, and public amenities that support a vibrant, transit-oriented neighborhood,” city officials said Monday in a news release.
They noted these land acquisitions also aim to address “critical environmental concerns, including flooding and rising sea levels.”
“With the potential to deliver thousands of housing units in the heart of Honolulu, we are excited to take this next step in advancing a project that will have long-term benefits for our community,” Office of Housing Executive Director Kevin Auger said in the release. “These acquisitions are essential to unlocking redevelopment opportunities within the Kuwili Station TOD area, including affordable housing, multi-modal connectivity, and neighborhood-serving uses envisioned in the master plan.”
“We’re committed to treating property owners and tenants with respect and ensuring that everyone affected receives the information, support, and assistance they need throughout this process,” he added.
On Tuesday, Auger told the Honolulu Star-Advertiser that “the city is evaluating multiple parcels on Kaaahi Street to support a future high-density, mixed-use development.”
“The total property needs are still being evaluated through the master planning process,” Auger said.
Compensation for properties will be based on fair market value, as determined by an appraisal of the property, according to the city, which will perform and pay for the appraisal report.
Property owners will be contacted in the coming weeks to schedule site inspections, officials said. Property owners also will receive detailed information on the appraisal and compensation process, and relocation assistance where applicable.
The city says this is not a notice to vacate.
“Impacted individuals are encouraged not to relocate or sign any new lease or purchase agreements until they have received formal notification of their eligibility for relocation benefits,” the city release said. “All affected occupants will receive a minimum of 90 days advance written notice prior to any required move.”
Auger told the Star-Advertiser: “At this time, to our knowledge, no residential properties or residential structures will be affected.
“However, to the extent any relocation becomes necessary, the city will provide full relocation assistance, under the Uniform Relocation Assistance and Real Property Acquisition Policies Act, including advisory services, moving cost coverage, and referrals to suitable replacement housing,” he said.
Jeffrey Chen, at family-owned Tina’s Creations Inc. at 519 Kaaahi St., said the city contacted his wholesale clothing business Monday via a written notice.
“The offer was that they would purchase the property at market value, if we were a business, and they would help us relocate,” Chen told the Star-Advertiser by phone Tuesday. “I think those were the two biggest points.”
Chen, whose family has owned its warehouse-based business on Kaaahi Street for over 10 years, said, “We sort of knew that this would be happening.”
“This isn’t the first time that they’ve mentioned purchasing the property,” he said, adding that his family sold a portion of the easement fronting their business to the city about a decade ago. “Even then they were talking about how in the future they’d have to buy the property. So we’ve sort of known that we’d have to” sell due to the proximity of the planned Skyline station.
“The rail station is also on our side of the street,” Chen said. “I think it’s going to go through this street, and to a field that’s been closed off,” not far from Nimitz Highway.
And, he added, there’s “always that threat of eminent domain.”
“It’s not like we can actually fight it to the end,” said Chen of the city’s possible condemnation plans for his property. “We’re just trying to get everything we want. … If it fits all of our requirements, it’s not too bad, but we do want to get everything we can get out of it, of course.”
Related development is occurring nearby.
In January 2024 the city closed a $51.5 million deal to purchase the Iwilei Center.
Acquired by the city Department of Land Management from Iwilei Center LLC, an affiliate of Blacksand Capital, the purchase of the 3.8-acre property included addresses at 850 and 866 Iwilei Road and 505 Kaaahi St., respectively.
This transaction was meant to convert the existing center — long home to warehouses, loading docks, offices for lease as well as more than two dozen commercial tenants — to a new, city-owned affordable housing development, the city said.
The Iwilei Center property alone totals about 167,032 square feet of land, the city estimates.
In early March the city issued a request for qualifications to find an experienced builder who can convert Iwilei Center’s aging warehouse space into a new mixed-use, transit-oriented development.
The Department of Land Management, in partnership with the Office of Housing, said the RFQ for the redevelopment project aims to site about 500 to 700 housing units. RFQs are due by April 30.
“All proposals will be reviewed through a transparent, competitive process,” Auger said.
The selected developer will oversee master planning, environmental clearance, architectural design, entitlement, financing, construction, lease-up and operations. In return the developer will receive a development contract and a 75-year ground lease, the city says.
The total cost of the Iwilei Center redevelopment is not yet determined, Auger said.
