KAPA‘A — The affordable housing nonprofit Permanently Affordable Living has bought the Hoku Building in Kapa‘a, which features 14 apartments and Hoku Foods Natural Market.
The buyers consider the purchase an “affordability preservation project” and guaranteed that rents would either be stabilized or reduced.
Though they also develop new affordable housing, PAL has been focused on purchasing existing buildings, which can provide affordable apartments at a lower cost.
“Unfortunately, buildings are not often available on Kaua‘i. Part of the reason for that is that most of the multifamily zoning on this island has gone to the upscale hotels and the upscale condominiums,” said PAL Executive Director and Founder Jim Edmonds in an interview with The Garden Island. “So when this building became available, it was only on the market two hours before I put an offer on it.”
The $3.53 million leasehold purchase was funded entirely by a one-time anonymous donation. The nonprofit will hold the lease for the next 99 years.
Edmonds reported Hoku Foods will stay on as a tenant, which he said will give them “stronger cash flow” and allow them to keep apartment rents low.
The most likely method for reducing rents will be to qualify some or all of the tenants for the Housing and Urban Development program that uses federal subsidies to ensure they pay no more than 30 percent of their income on rent. Residents of the building currently pay $1,800 a month for studios.
Founded in 2018, PAL focuses on providing benefits to tenants that improve their living experience.
“We are doing all kinds of things to try to save people money,” said Edmonds, citing edible landscaping, community gardening, on-site laundry, solar investments and shared electric vehicles as projects they were implementing or hoped to pursue on their properties.
Last February, with the help of another anonymous donation from the same source, PAL purchased a 13-unit apartment building in Kekaha.
Since the buy, that property has undergone a transformation, adding a business incubation center, laundry, and renovated rooms. PAL is currently working to install an $850,000 wastewater treatment system, solar panels, and electric vehicle infrastructure.
All the tenants now pay affordable rent through the HUD program, with PAL reporting the majority of them were formerly homeless.
PAL Communications Director Sarah O’Rourke brought up an example of a homeless couple that struggled to get necessary medical care because of their precarious housing situation. They now pay affordable rents as tenants in the Kekaha building, and have been able to access the care they need.
“That’s the real-world impact for individuals,” O’Rourke said.
With the Hoku Building buy, PAL now owns 27 total apartments.
In addition, they have affordable home developments in the works in Kilauea, Waipouli, and Kalaheo — the latter two are being built in collaboration with Habitat for Humanity.
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Guthrie Scrimgeour, reporter, can be reached at 808-647-0329 or gscrimgeour@thegardenisland.com.
