State Leasehold Condo Project Faces Challenges

Proposed 99-year leasehold tower in Honolulu needs to balance affordability and desirability to attract buyers.

Published on Feb. 28, 2026

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The state of Hawaii is planning to build a first-of-its-kind, 99-year leasehold condo tower on state-owned land in Honolulu, but the project has faced challenges. Private developers say the costs will be too high to make all the condos affordable, while state administrators doubt the leasehold units offered at 'market' prices will sell. Legislators are considering changes to the leasehold rules to make the project more viable, including reducing restrictions on resales and rentals.

Why it matters

This leasehold condo project is seen as a potential model for future development in the New Aloha Stadium Entertainment District, so getting the right balance of affordability and desirability is crucial. The success or failure of this project could impact the state's broader efforts to address Hawaii's housing affordability crisis.

The details

The state-owned land for the leasehold condo tower is located at the corner of Ward Avenue and Kapiolani Boulevard in Honolulu. Private developers chosen to plan and build the condos say their costs will be too high to make all the units affordable, while Hawaii Community Development Authority administrators doubt the leasehold units offered at higher 'market' prices will sell at all.

  • The state is planning to build the 99-year leasehold condo tower on state-owned land in Honolulu.
  • In 2021 and 2022, a Legislature-ordered study concluded that two-bedroom condos selling for $400,000 would be in high demand.

The players

Hawaii Sen. Stanley Chang

A state senator who has championed state-supported leasehold development in Honolulu for years.

Kali Watson

The director of the Department of Hawaiian Home Lands, whose mission is creating thousands of affordable homes for Hawaiians on 99-year leasehold sites.

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What they’re saying

“If these changes can make the project pencil out, they should be adopted.”

— Hawaii Sen. Stanley Chang, State Senator

What’s next

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