The apartments at 1427 Ernest St., which opened with fanfare in 2023, were billed as an early success story in a city plan to fast-track new low-rise affordable rental units.

While the 26-unit new building has provided housing, it also has become a point of tension among neighbors who complain about new competition for already tight street parking and other concerns, in what has become a common refrain for development in Honolulu.

At neighborhood board meetings, critics said the program might be well-intentioned, but they called for more guardrails to cushion the impact on neighborhoods. 

Last month, City Council member Scott Nishimoto introduced a bill to add three new requirements to this type of project in response: more off-street parking, on-site managers and presentations from developers to the local community on what’s being built before applying for permits. 

“It’s not just one project,” Nishimoto said. He said residents in Makiki and McCully have told him that they’re frustrated with new housing units that are built without any notification.

He introduced Bill 53 to address these issues. Opponents say the changes would hamstring an already struggling program, preventing needed new affordable rentals from being built as the city faces a growing housing crisis. Supporters say the requirements make sense to prevent a proliferation of housing units going up without much thought.

The measure would modify a city law based on Bill 7, which was passed in 2019 and provides incentives for developers to build new affordable rental apartments.

“This is the start of a conversation that hopefully results in Bill 7 projects that are good for everybody,” Nishimoto said, “including the community.”

Controversial New Requirements

Residents of 1427 Ernest take issue with the proposed changes, with 21 of them signing a letter supporting the rentals program as is.

“This legislation has successfully expanded access to affordable rental units, directly benefiting tenants like us by providing much-needed housing stability and affordability,” the letter reads. “In gratitude for the housing security and affordability Bill 7 has provided us, we cannot say “Mahalo” enough.”

Geena Thielen, a developer who worked on 1427 Ernest St. and is a part-owner of the Makiki property, said the proposed requirements would kill future Bill 7 projects. 

A big part of the debate is whether a minimum amount of parking should be mandated as part of development plans. The affordable units at 1427 Ernest, a 3-story walkup, didn’t come with any parking, and Nishimoto’s proposed changes include requiring one off-street parking spot for every two housing units.

“When there is a building with no parking, it impacts the entire neighborhood,” Desda Kane, who lives near the new building, said in written testimony supporting Nishimoto’s changes. “Everyone has to scramble for street parking where it may not even exist.”

But building the space for parking can be expensive, housing advocates say, and that expense is either passed to residents or absorbed by the developer. 

“We simply can’t afford to put in even half of the units having parking stalls,” Thielen said.

Nishimoto also proposed that each new development should have an on-site property manager. But Thielen said that, in her experience, that isn’t a common practice for relatively small-scale housing developments like those constructed via the program. 

“In talking with a number of different property managers about our projects and buildings,” she said, “the feedback that we have gotten is that it’s very uncommon to have resident managers.”

In addition, the bill would require developers to present their proposed projects to the relevant local neighborhood board. If the board doesn’t provide an opportunity to present within 60 days of a written request — or if the board decides no presentation is needed — the requirement would be satisfied.

Expediting Projects

Bill 7 has had limited success since passing in 2019. It relaxed zoning standards on small lots of less than 20,000 square feet and exempted the affordable rental housing projects from property taxes for 10 years. Doubling down on the effort, in 2024 the city also started giving developers of these projects cash grants of up to $12,000 per unit. Half a dozen buildings have been completed so far.

When 1427 Ernest opened in 2023, developers touted the fact it only took nine months to complete the project.

Paul Lam, who worked with Thielen to develop the project, said in an interview that the building filled up quickly after it opened. He also pointed to a video on his company’s YouTube channel that shows residents of 1427 Ernest St. talking at the project’s Christmas party about how grateful they were for the project.

Bill 53 will be discussed at 2:30 p.m. Tuesday by the council’s Housing, Homelessness, and Parks Committee.

Read the bill below:

Civil Beat’s reporting on economic inequality is supported by the Hawaiʻi Community Foundation as part of its work to build equity for all through the CHANGE Framework; and by the Cooke Foundation.