Hawaiʻi Housing Finance & Development Corporation

1. What is the HHFDC and how do they help?

The Hawaiʻi Housing Finance and Development Corporation (HHFDC) is the primary state agency tasked with increasing and preserving affordable and workforce housing.

Rather than managing units directly, the agency acts as a catalyst for new housing by providing essential financial tools, such as low-interest loans, tax credits, and revenue bonds, to developers, non-profits, and other partners.

By using a supply-side strategy, HHFDC helps make it financially viable to build homes at prices that local families can actually afford.

2. What is “Affordable Housing”? And is it really affordable for everyone?

In Hawaiʻi, “affordable” is often tied to federal income guidelines known as Area Median Income (AMI), which define price caps for housing. It is completely understandable why many residents feel this term does not match their reality, especially when factoring in HOA fees, insurance, and interest rates.

To address this, the state uses a tiered approach to ensure support reaches everyone across different economic levels:

• For Workforce Households: HHFDC programs target moderate-income families (80% to 140% AMI) through ownership and rental initiatives to ensure teachers, nurses, and essential workers can find housing that fits their budget.
• For Low-Income Families: Our sister agency – The Hawaiʻi Public Housing Authority (HPHA) – provides safe, decent, and sanitary housing, including federal public housing and the Housing Choice Voucher (Section 8) program, which subsidizes rent for those with the lowest incomes.
• Redevelopment: The state is transforming older properties into affordable units that are modern, by retrofitting outdated buildings. The Hocking Building in Honolulu’s Chinatown is now sustainable housing while maintaining long-term affordability for those who need it most.

3. Why is it still challenging for local families to find a home, and what is the outlook?

Such is the challenge of our island life where there is only so much developable land and a finite amount of resources to work with. HHFDC is doing what it can in its domain – while the housing shortage is a significant challenge, HHFDC is aggressively expanding programs like the Hale Kamaʻāina Mortgage Program, which offers competitive fixed-rate financing to help first-time buyers.

By focusing on record-level production and targeted assistance, the state is actively working to open more doors for local families every year, creating a more sustainable path toward ownership.

4. What is Transit-Oriented Development (TOD), and why is it our future?

TOD is a forward-thinking, sustainable strategy to build homes, shops, and services within a short walk of public transit stations, like the new Skyline rail and evolving TheBus routes. By creating vibrant, walkable neighborhoods, this approach reduces the need for cars and significantly lowers monthly transportation costs.

We are proudly drawing inspiration from successful global models, such as the high-quality public housing systems in Singapore, the efficient and world-class rail transit networks in Japan, and the dense, interconnected urban vitality of New York City.

By adopting these best practices, we are working to move away from traditional urban sprawl and toward a more connected, efficient, and community-focused island lifestyle. This approach helps us preserve our precious open spaces while making it easier for people to get to work, school, and play.

5. Will building dense housing near transit create “slums”?

Absolutely not. The modern approach to housing development in Hawaiʻi is centered on mixed-income and mixed-use design, which is fundamentally different from the outdated projects of the past.

These new developments, particularly those centered around Skyline stations, are intentionally designed to be socially and economically diverse, vibrant, integrated communities where a variety of housing options are seamlessly woven alongside neighborhood retail, essential services, and public spaces.

By concentrating this development near transit, we ensure that residents of all backgrounds have convenient access to the same high-quality transportation, jobs, and community amenities. This strategy fosters an inclusive environment, ensuring that these transit hubs become welcoming gateways for all residents, regardless of their income, and creates a natural, daily interaction between diverse groups of people that strengthens the social fabric of our islands.

6. How does the rail system benefit those who don’t ride it? What is HHFDC’s role?

HHFDC is not directly involved in the planning and construction of rail itself. Public investment in infrastructure is always a conversation about priorities, and it is fair to question how tax dollars are utilized. While one may not personally ride the train, the rail system is a primary engine for creating the new, affordable housing our island desperately needs.

The rail corridor is the foundation for creating thousands of new, permanently affordable homes for our local workforce and future generations. By concentrating high-density, affordable housing near these stations, we can unlock housing capacity that is simply not possible in our traditional neighborhoods.

Investing in the rail system is, at its core, a direct investment in a future where your children and grandchildren can afford to live, work, and thrive. Beyond housing, this infrastructure is a catalyst for economic renewal, providing the necessary momentum to revitalize areas that have historically lacked investment.

Just as we invest in schools for the benefit of our society, this infrastructure is a long-term commitment to ensuring that the next generation of residents has a place to call home and a vibrant economy in which to succeed.

7. Why is the Aloha Stadium site being redeveloped, why not just build a stadium? And what is the HHFDC’s role?

This development is outside of HHFDC, but based on public information, the state is transforming the 98-acre Aloha Stadium site into the New Aloha Stadium Entertainment District (NASED) to better serve our community. Previously, this massive state-owned space was underutilized and tax-exempt, meaning it generated no property tax revenue for the county.

By redeveloping the area into a vibrant, mixed-use district, the state is creating a sustainable revenue stream to help offset the costs of building a new, modern stadium.

While the Stadium Authority manages the project and the master developer, Aloha Hālawa District Partners (AHDP), leads the construction and district development, the HHFDC serves as a vital strategic partner. HHFDC supports the broader vision for the district by providing expertise in financing and developing the thousands of planned housing units—ensuring they meet essential affordability and workforce goals—which is a key component of turning this concrete expanse into a thriving, seven-day-a-week neighborhood.

8. Why are there so many new high-rises in Kakaʻako, and are they all “luxury”?

While the Kakaʻako skyline is dominated by new towers, it is a common misconception that all of these developments are exclusively for the wealthy. Many are intentionally designed as mixed-income communities that include a significant percentage of affordable workforce housing, rentals, and even senior-focused units.

It is important to remember that these “affordable” or “reserved” units are strictly governed by Area Median Income (AMI) limits. Developers in this district are often required to reserve a large portion of their units for residents earning below 140% of the AMI.

Below are some examples of developments in the Kakaʻako area that integrate these affordable options:

• Kahuina: This development has 396 reserved HHFDC homes. Within this, select one- and two-bedroom affordable starter units also qualify for the DEP program, which offers qualified local residents additional HHFDC equity assistance to help lower their qualifying loan amounts.
• Waiakoa: The Waiakoa project is built on land owned by Kamehameha Schools. HHFDC’s involvement comes from its 201H program, which provides fast-tracked development approvals and regulatory exemptions in exchange for designating 620 of the 1,032 condo units as affordable for local households making up to 140% of the Area Median Income (AMI).
• Ililani: The Ililani is a 42-story mixed-use condominium in Kakaako that features a large portion of affordable housing units developed and regulated under the HHFDC.

9. Why does housing development take time in Hawaiʻi?

Building in our island home is a unique endeavor, and we are committed to doing it right to ensure our communities thrive for generations to come. While projects naturally take time, we are working diligently to navigate these distinct local factors:

• Island Logistics: Our geographic beauty means we rely on thoughtful supply chain management for construction materials. We are finding innovative ways to coordinate logistics to keep projects moving forward efficiently.
• Thoughtful Planning: Hawaiʻi’s world-class environmental and land-use standards are vital to protecting our islands. We are working to harmonize these important protections with smarter, faster review processes.
• Building for the Future: Investing in our islands means building strong, resilient infrastructure, like robust water and sewer systems, upfront. This foundational work ensures the long-term health and safety of our neighborhoods.
• Investing in Local Talent: We are proud to support and grow our local workforce. By fostering partnerships and training opportunities, we are building a strong pipeline of skilled tradespeople dedicated to shaping the future of Hawaiʻi’s built environment.

10. What is being done to address permitting bottlenecks?

This is outside of HHFDC’s mission, but we understand that permitting delays have long been a major barrier to housing production, but the government, including state and county agencies, is actively working to modernize and streamline the system.

Key initiatives include:

• The SPEED Task Force: An interagency group working to identify and resolve systemic bottlenecks across state and county permitting agencies.
• Expedited Permit Processes: Legislation has been passed to allow for expedited permit reviews for certain housing projects, creating a “statutory shot clock” to reduce waiting times.
• Staffing & Tech Upgrades: Counties are being incentivized to recruit more permitting staff and implement software upgrades, like the HNL Build system in Honolulu, to improve efficiency and tracking.
• Professional Accountability: New policies are encouraging licensed professionals to play a greater role in certifying project compliance, which helps reduce the number of review cycles and speeds up the overall process.

11. Why do people worry about “flipping” affordable units, and how is HHFDC stopping it?

It is a common concern that homes intended for residents might be used for profit instead.

To keep these homes as long-term assets for the community, the state uses protective measures like Buyback and Shared Appreciation Equity (SAE) programs.

These rules ensure that owners stay in their homes and that the affordability stays with the unit, preventing speculative investors from taking enough advantage of programs designed for local families.

12. How did HHFDC help immediately following the Lahaina wildfires, and what is the current progress on new state-funded housing there?

In the immediate aftermath of the August 2023 wildfires, Governor Green tasked HHFDC with rapidly creating the Hawaiʻi Fire Relief Housing Program.

With no existing playbook, HHFDC staff worked tirelessly to build an intuitive, tech-enabled matching service that connected displaced Lahaina families with property owners statewide who had vacant rooms or homes available. This program successfully helped approximately 600 households find immediate, safe shelter.

Today, HHFDC remains deeply committed to Lahaina’s long-term recovery. We are actively working with partner agencies on interim housing solutions, such as providing support for state-sponsored sites, and we are focused on the development of permanent housing.

A key example is our Kaiāulu o Kukuʻia site in Lahaina, where we look forward to completing the first permanent affordable units to help our neighbors return home.

13. What is the HHFDC’s role in the Villages of Kapolei, and what is the status of the infrastructure transfer?

The HHFDC served as the master developer for the 888-acre Villages of Kapolei, a community designed to provide thousands of homes for local families.

A very positive milestone is currently underway: HHFDC is actively working to transfer the ownership and maintenance of the community’s public infrastructure, such as roadways, sewer systems, and drainage, to the City and County of Honolulu.

This transition is a collaborative effort to ensure these assets are managed long-term by the City, and it is a key step in fulfilling the original master plan. HHFDC is also overseeing the final phases of development, such as the Haku Kapolei project, which will provide hundreds of additional affordable homes to complete the community’s vision.

14. How is the HHFDC involved in Waiahole Valley?

HHFDC serves as the state’s custodian and utility operator for Waiahole Valley, a role rooted in the historic 1977 settlement that preserved the valley’s rural, agricultural character.

HHFDC’s involvement includes managing the state-owned potable water system, overseeing residential and agricultural ground leases, and maintaining essential infrastructure like roadways.

The agency is committed to ensuring these leases remain affordable and sustainable for multi-generational farming families, recently signing amended agreements that keep rents below-market through 2038 to support local food production.