The Honolulu City Council approved a special transit oriented development permit Wednesday, clearing the way for Hawaii City Plaza, a proposed 26-story condominium tower along Sheridan Street near the planned Ala Moana rail station.

The project is the third to receive a special TOD permit, which offers developers height and density zoning waivers in exchange for community benefits.

Communication issues plagued developer Jay Fang throughout the permitting process and continued up until the council voted 8-1 to approve the permit.

The only vote against the permit came from Councilman Joey Manahan, who sharply questioned Fang about an email sent to Councilman Ikaika Anderson in May by Jay Fang’s father, Johnson Fang.

Manahan said the email “berated” the council.

Natanya Friedheim / Civil Beat

At the meeting, Jay Fang apologized for the email. Lloyd Yonenaka of public relations firm CommPac stood next to Fang and helped him communicate with the council.

Among other things, the email explained why the developer didn’t plan to use unionized labor for the project’s construction, an aspect of the proposal that some council members opposed.

“I am thinking that the union might provide you some personal benefit but not the community benefit,” the email said. “The union could provide you campaign finance and votes.”

It’s unclear if the development will ultimately be built using union labor, but on Tuesday, Reginald Castanares of Plumbers and Fitters LOCAL 675 and Hawaii Building and Construction Trades Council submitted testimony from both unions in support of the project. Castanares could not be reached for comment Wednesday.

Written testimony also arrived Tuesday from International Union of Bricklayers and Allied Craftworkers Local #1 in support of the project.

Jay Fang’s proposal also faced criticism in May when it became clear he planned to finance the project using a federal program that offers foreign nationals a special visa if they invest in an area with high unemployment.

Most of the investors financing the project would be residents of China, Fang said then.

Hawaii City Plaza

Council members worried that the people buying units in Hawaii City Plaza will also be foreigners rather than local people.

“It is illegal to oppose the project just because we anticipate to sell to Chinese,” the email read. “If you insist on opposing our project for the reason that we will sell the majority to Chinese customers, I will call on Chinese to not visit Hawaii.”

Fang is seeking a second special TOD permit for a 400-foot high-rise near Ala Moana Center currently before the council.

At 250 feet, Hawaii City Plaza’s bonuses are modest compared to the two 400-foot hotel projects already approved for special TOD permits.

Hawaii City Plaza will include 33 units billed as affordable to people at or below 80 percent of the area median income ($58,600 for an individual). The affordable units will be in the same structure as the market rate units, another feature that sets Hawaii City Plaza apart from the two hotels already approved for TOD permits.

To make it affordable to people at 80 percent of area median income ($58,600 for an individual), rent in one-bedroom units can’t exceed $1,492 per month and $1,982 for two-bedroom units.

More Extra-Tall Ala Moana Towers Proposed

Also at Wednesday’s meeting, Keith Kurahashi of R.M. Towill Corporation presented real estate development company Avalon Group’s plan to build two towers near Ala Moana. The project would also require special TOD permits.

Sky Ala Moana would cover 70,000 square feet at 1400 Kapiolani Blvd., near Makaloa Street directly across the street from the planned Ala Moana rail station.

The first tower would contain 400 condominium units.

In an interview with Civil Beat in November, Christine Camp of Avalon Group said the units would cost from $550,000 to $900,000 each.

With 420 units, the second tower would contain mostly condominium-hotel units along with 77 “affordable” rental units and 37 market-rate rental units at the bottom of the tower.

Like the affordable units at Hawaii City Plaza, rent in the affordable units in Sky Ala Moana’s tower would be available to people who earn no more than 80 percent of area median income.

A recently approved resolution requires developers seeking special TOD permits to present their project to the council early in the permitting process, at the same time the project is presented to the neighborhood board representing the area where the development is proposed.

After the presentations, the city’s Department of Planning and Permitting has three months to review the project and make recommendations.