Maui County Council members gave final approval Friday morning to an intergovernmental agreement for the state to purchase the 6.2-acre Haggai Institute for affordable long-term rental housing.

Council members heard three testifiers who had concerns about traffic and sufficiency of infrastructure in the vicinity of the project off of Līpoa Street in central Kīhei. Within 15 minutes, Council members voted 9-0 to approve the agreement and adjourned the special meeting for final action on the matter.

In written testimony, Megan Pearl opposed the proposed agreement.

Pearl likened the Haggai purchase for workforce housing to low-income housing at Harbor Lights in Kahului, and, although the property was suggested as housing for Lahaina wildfire survivors, “most Lahaina families have made it very clear they do not want to relocate out of Lahaina.”

Also, “there hasn’t been a traffic study done in 25-plus years,” Pearl said. “Increased vehicle and pedestrian traffic would be concerning given how congested Līpoa/Līloa/Piʻilani already gets due to various circumstances when South Kīhei is closed, or if there is an accident, fire, or even 4th Friday events. This could create a potential disaster for any sort of emergency vehicles that would need to access these roads, let alone residents in the area who may need to vacate the area for any sort of emergency reason.”

The former 216-room Maui Sun Hotel will be renovated to create housing for residents. At first, the property will house wildfire survivors and emergency responders, including the American Red Cross. Long-term, it will be converted into affordable workforce housing, with at least a quarter of the units set aside for teachers.

An intergovernmental agreement detailed in an HHFDC staff report sets out how Maui County and the Hawaiʻi Housing Finance and Development Corp. will work together to develop housing units at the former hotel and Christian missionary training center. The property is off of Līloa Drive and Līpoa Street, kitty-corner from Kīhei Elementary School.

Several weeks before the Aug. 8 wildfires, the Legislature appropriated $45 million for the Haggai acquisition.

HHFDC officials told council members early this month that the state plans to make rooms available to wildfire survivors within about a month of purchasing the property. The housing would be for those who do not qualify for Federal Emergency Management Agency assistance. The Red Cross has been using the facility for housing personnel and as a disaster response headquarters.

The agency has occupied 60 rooms, but it planned to scale back in the coming months, officials said.

According to plans, the HHFDC will purchase the property for $38 million from the Haggai International Institute for Advanced Leadership Training Inc. While work is ongoing on permanent housing renovations, the HHFDC will contract with Paramount Hotels to provide property management services.

A 75-year ground lease with Maui County is expected to start in May 2025. HHFDC has pledged to provide technical assistance for the county to issue a request for proposals for a developer to sublease the property and convert it into permanent housing and pre-K classrooms.

According to a timeline for the project, requests for proposals would be published in June of this year, followed by an award to a developer in the first half of next year and a yearlong design and permitting process beginning in May 2025. Construction could start in June 2026 with completion in July 2027.

Maui County has set aside $7.5 million for renovation of the former hotel. Of that amount, $5.5 million is from the Affordable Housing Fund and $2 million from the General Fund.

After conversion to permanent housing, a third of available units will be set aside for families earning no more than 80% of Maui County’s median income, he said. Another third would be for families making from 81% to 100% of median; and a final third would be set aside for families earning from 101% to 120% of median.

The Haggai property has 168,000 square feet of floor space in two, six-story wings. Amenities include 288 parking stalls, meeting rooms, a library, a commercial kitchen, a dining area, a pool, a koi pond, soccer fields and a gym. The property’s location in central Kīhei makes it a short walk or drive away from two supermarkets, Maui Bus routes, schools, restaurants, the Kīhei community and aquatic centers, and the Azeka Shopping Center.