Judge decides Front Street housing must stay affordable

When it first built the project in 2001 as an affordable rental housing complex for low-income residents, the developer promised to keep apartments affordable for 50 years in return for $15 million in state tax credits and $5 million from the county in real estate tax reductions, according to lawyers for the plaintiffs.

After 15 years, however, Front Street Affordable Housing Partners asked the state’s financing agency, the Hawai’i Housing & Finance Development Corporation, for permission to end the restrictions.

Developers cited a change in federal tax law that allows them to be released from their low-income commitments after 15 years if they were unable find a buyer for the project within a certain time frame. They planned to raise rates to market price by August 2019.

“The state should not have let the developer out of its promise,” Tom Helper, litigation director of the Honolulu nonprofit Lawyers for Equal Justice, said during the news conference.

In 2018, a small group of tenants from the 142-unit complex filed a lawsuit that challenged plans by the developer to convert the complex to market rates before the end of its 50-year affordability commitment.