A more than century-old building in Chinatown that used to be a bank after it was a boardinghouse, and might have ghosts in the basement, is about to become an addition to Honolulu’s affordable-housing inventory.

The $30 million conversion of the historic Hocking Building on a corner of North King Street and Nuuanu Avenue includes 40 apartments with monthly rent as low as $731, meeting space for the Downtown-Chinatown Neighborhood Board and office space for the nonprofit Institute for Human Services.

Tenants are expected to begin moving in in December, and partners in the project, largely financed by the state, city and federal governments, held a blessing ceremony Friday.

State Rep. Mark Hashem, a principal in the project’s development partnership, said a lot of unique challenges emerged since taking on the project in 2019, including unreconciled property boundaries, historic-preservation requirements and working through delays during the coronavirus pandemic.

“I can’t believe we’re actually here,” said Hashem (D, Waialae- Aina Haina-Hawaii Kai) during the ceremony in the building’s ground-floor space that will serve as a meeting hall for community use and was previously a First Hawaiian Bank branch.

Kahu Kordell Kekoa, who delivered the Hawaiian blessing, was asked to give some extra attention to the basement to address stories Hashem heard from elevator maintenance personnel who mentioned ghosts in the subterranean space, which includes a bank vault and dumbwaiter portals that used to connect to sidewalk openings above.

Part of the building was erected in 1883 and then added onto in 1916 by Alfred Hocking, a prominent Hawaii businessman and government official originally from England who had gotten into the lumber and sugar cane business on Maui and represented the Valley Isle as a senator for the republic of Hawaii.

In Honolulu, Hocking founded the Honolulu Brewing and Malting Co. in a brick building he built in 1899 on Queen Street in Kakaako. The brewery building, also known as the Royal Brewery, became the original home of Primo Beer and today serves as the state-owned home of the Hawaii Community Development Authority.

The two-story Chinatown building Hocking acquired and connected with a three-story addition served as a long-term-stay hotel catering to traveling businessmen. In the 1960s the building was converted into a bank, and upper floors became a cavernous space for bank storage.

Hashem, a commercial real estate agent, responded to a for-sale listing of the historic building by his own firm, Sofos Realty Corp., with an affordable-housing conversion plan, and ended up buying the property from descendants of Hocking, whom Hashem described affably as “five old ladies” who live on the mainland. Hocking died in 1936.

“I want to thank the family,” Hashem said. “This is the first time this building has changed hands in over 100 years.”

Joining Hashem as primary principals of the project’s development partnership were Kevin Unemori and California-based developers David and Joseph Michael, whose Hawaii affordable- housing projects include Halawa View Apartments, Hale Makana o Maili and Kewalo Apartments.

A state agency that helps finance affordable housing, the Hawaii Housing Finance and Development Corp., provided a $12.4 million loan and $9.7 million in state and federal tax credits.

The project also received $4 million from the city and about $3 million in federal tax credits available for preservation of historic properties.

“This serves as a prime example of how the cooperation of government and the private sector can successfully combat our housing challenges,” David Oi, HHFDC housing finance manager, said during the ceremony. “These (40) units here will help fill much-needed space in Honolulu’s affordable-housing landscape.”

Honolulu Mayor Rick Blangiardi said it was gratifying to see the project being realized, and described his administration’s financing contribution as probably the best $4 million ever spent by the city.

“This was a great opportunity for us,” Blangiardi said. “We are privileged that we had the opportunity to come in and help make the deal happen.”

Amenities in addition to the community meeting hall include a fitness room, laundry room and computer room.

Ernest Caravalho, chair of the Downtown-Chinatown Neighborhood Board, said the conversion of the building will be nice for meetings, and he hopes the residents will help improve conditions in the neighborhood with the presence of more people after typical business hours.

“I can’t wait,” he said. “This is great.”

IHS is expected to use the basement as office space and to provide services for some building residents who were previously homeless.

Indigo Real Estate is managing the property, where a preference for apartments has been provided to people who are homeless.

Nearly all the apartments, which are air-conditioned and include units with high ceilings, are reserved for households earning no more than 50% of the annual median income in Honolulu. This equates to $48,750 for a single person, $55,700 for a couple and $69,600 for a family of four.

Monthly rents for 36 units tied to this income limit are $1,218 for studios, $1,305 for one-bedroom units and $1,566 for two-bedroom units.

Four units in the project are reserved for households earning no more than 30% of the median income, with rents of $731 for a pair of studios, $783 for a one- bedroom unit and $939 for a two-bedroom unit.

Indigo is still accepting applications but has a waitlist of about 70 applicants.

As a condition of state financing, apartment rents must remain affordable for low-income households for 61 years.