The nonprofit operator of the Kahala Nui senior living complex is buying the land under the project built in 2005 on a parcel leased from the Roman Catholic Church of Hawaii.
Kahala Senior Living Community Inc. and the church’s Diocese of Honolulu announced the purchase and sale agreement for the 6.5-acre site Thursday.
A price was not disclosed. The transaction is expected to be completed by the end of the year.
As part of the agreement, the Mary, Star of the Sea Parish church and school on the same property will maintain access to underground parking stalls, a soccer field and existing easements.
Diocese of Honolulu Bishop Larry Silva said in a statement that Kahala Nui has been a valued tenant and wonderful neighbor for 19 years, and that the sale will benefit both entities.
“This agreement enables Kahala Nui to gain ownership of the land under its facilities, allowing for greater stability and flexibility in its long-term planning and development, while at the same time, providing the Diocese of Honolulu with the critical funds needed to ensure the Catholic Church can continue ministering to our faithful and community for many generations to come,” he said.
Craig Courts, Kahala Nui president and CEO, said in a statement that purchasing the land helps secure the project’s future, which includes potential expansion, and ensures that the nonprofit company can continue to serve its residents and the community.
“We are deeply grateful to the Diocese of Honolulu for their partnership over the past two decades and look forward to continuing our shared commitment to the greater good of our community,” he said.
Kahala Senior Living developed the 393-unit project, then billed as a luxury senior living community, for about $200 million under a 60-year land lease. Residents pay monthly fees for apartments and services, and initially pay a deposit, which for some units can be around $1 million and is 90% refundable upon leaving.
Proceeds from the land sale will in part be invested and used as a perpetual endowment fund managed by the Hawaii Catholic Community Foundation for the Star of the Sea church and the Diocese of Honolulu so that they continue to receive the same amount of revenue that was generated by the Kahala Nui lease.
The Diocese of Honolulu also will use some proceeds to pay off debt, contribute to priest and lay pension funds, and to create perpetual endowments for seminarian and clergy education, deacon formation and clergy medical and retirement expenses.
Another portion of proceeds will be given to the Augustine Educational Foundation, a nonprofit under the Diocese of Honolulu that provides financial assistance to students in need attending Catholic schools in Hawaii, as well as to the historic Cathedral Basilica of Our Lady of Peace in downtown Honolulu for critical repairs and renovations. Our Lady of Peace was established in 1828 as the first Catholic parish in Hawaii, and the current Cathedral Basilica was dedicated in 1843, according to the church.
