State Pays Steep Price Increase For New Maui Housing Contract

Honokowai Kauhale
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Honokowai Kauhale

BY JIM DOOLEY – The state will pay considerably more for property management services at a troubled Maui affordable housing project under a six-month non-bid contract that took effect last week, according to procurement records.

The Hawaii Housing Finance and Development Corp. will pay Hawaii Affordable Properties, Inc. $375,000 to oversee the 184-unit Honokowai Kauhale complex, according to a procurement form. The state would have paid some $247,000 for the same work under an earlier contract held by a competing firm, Realty Laua LLC.


HHFDC terminated Realty Laua October 17, informing the company that it was “not in compliance” with the terms of its contract, according to state records.

The new contract award to Hawaii Affordable Properties means the company is now managing eight of nine housing projects owned by HHFDC around the state. Realty Laua manages the ninth.

News stories published by Hawaii Reporter since August 22 revealed chronic vacancy and maintenance problems at Honokowai Kauhale, an affordable rental housing complex in the Kaanapali area of West Maui.

Nearly 40 per cent of the apartments at the complex have been vacant for lengthy periods of time – five years in some cases – and some residents reported that they felt intimidated by property manager Lisa Faleafine and her live-in boyfriend, state parolee Iokepa Auwae. Other residents later wrote letters of support for Faleafine and Auwae.

HHFDC said it was not aware of the problems at the project until Hawaii Reporter inquired about them.

In justifying the award of the sole-source contract to Hawaii Affordable Properties, HHFDC cited “a series of newspaper articles published from August 22, 2011 through October 4, 2011 (that) raised concerns from residents, former employees, and state legislators about the property management staff and site conditions” at Honokowai Kauhale.

After an audit was conducted at the housing project, HHFDC determined that Realty Laua “was not in compliance with its contract” and the company was given 10 days to cure deficiencies, according to the procurement notice.

Realty Laua “failed to provide a satisfactory cure” and its contract was cancelled October 17, said HHFDC.

Realty Laua president Robert Faleafine has not responded to repeated requests for comment. A message left with his office today was unreturned.

Karen Seddon

HHFDC executive director Karen Seddon has refused to release the compliance audit or the termination letter.

HHFDC said it intends to seek competitive bids for a Honokowai Kauhale property manager while the six-month interim contract to Hawaii Affordable Properties is in effect.

The award of the sole source contract was necessary because “management and maintenance staff need to be onsite daily at the housing complex to ensure proper care and maintenance of the project, and to ensure that vital services such as water, electricity, and sewage are not interrupted,” said HHFDC.

Staff turnover at HHFDC has complicated the procurement process, the agency said.

“One of two key staff members responsible for procuring and administering the property management contracts for all of HHFDC’s rental properties is no longer with the agency and the new Asset Manager now assuming the responsibility of procuring the new contract was only recently hired on September 1, 2011,” said HHFDC.





  1. It is really sad that the state has not sent someone out being at least some progress has been made. Was just looking at the picture of Seddon and she doesn’t look like a bad person but then again looks can be decieving. Do you really think she is in all of this with realty luau? Why would the state allow Lisa to stay? That makes no sense but then again none of what has gone here does. I think the next step should be to visit the governor. He has taken so much bad press lately that I am pretty sure he doesn’t want something like this to get out.

  2. Okay Murray! It’s November 02, 2011, and Lisa and Kepa is still here!. But we are starting to see slow changes on the property. Rumors is that a Temp Resident Manager by the name of Tim is on property(That’s Good!). Tenants are seeing tree trimmers manicuring the property. Looks like they are cleaning out the empty units(Thats Good!) and This morning tenants are seeing maintenance raking around the property, and cleaning out the Laundry Mat.(Good!)atleast we have someone or somebody ligit that is taking care of the place. This cleanup and bringing this place back to liveable is costing tax payers so much money, that Realty Laua has caused. It’s so upsetting to see that more money has to fork up for their greed. The State should have them clean up their own(OPALA) on their expenses not ours. Something good has gotta come out of this!

  3. Ok…it’s amazing to read how much money it is costing us as tax payers!!! Who does that. Then we the people wonder why or how Hawaii is in debt!!! Well, because, you have people in the State and County that is not doing their job properly. How is it that this company is getting away with this crap. This is not fair and not right. Because these people in the state did not do their jobs correctly in the beginning we are just wasting our tax $$$!!! That is simply baffling to me!!! And look, it is November 3rd and they are still on property along with the other ex-employees of Kauhale. Come on people, what the hell is going on here and tell us what is going to happen to this company. Yes, as Lanakila has stated, they are slowly cleaning up the place here and there are new tenants starting to move in but still on the north end of the property the grass is getting about knee level etc…I guess all in due time. What about the Faleafine’s and the Auwae’s???? What are you going to do with them? I’d be so upset if they do not press charges on these people and the company they represent, Realty Laua!!! That would be a BIG DISAPPOINTMENT and a slap in our faces, not for us the tenants but the people of Hawaii and everyone else that pays taxes!!! Get them off the property already!!!

  4. Laughin…dey finally got it! They finally understand dey lost and GOOD-BYE..Lisa and Kepa finally got it clear between the eyes that they gotta move out and they are doing it by themselves. So much for their “so-called friends and supporters”. Now that Lisa has nothing to offer without her “powers” she got no “friends”

  5. This message to all you supporter of Lisa and Kepa! Please know that you are all blinded by the fact that these people you are feeling sorry for is not good!…They have been many of us that are very heartful and humbled people that would not wish this on anyone, BUT! think about it’s it’s all of your hard working money taken away from your pockets and food on your table, gas in your car, clothes on you and your children’s back. We can only know the mistakes they have put all of us thru for so long. Now for some of you that supports her knows the diffrence from right and wrong, you gotta I’m sure you teach your children that. The point is they did such bad things to a lot of people in all walks of life. Maybe you haven’t seen that bad side of her, but in time you will all understand what the world is trying to say. GOD is the only one that will punish her and all that walks with her, so in our eys he has answered our prayers, and she is now walking in shame and she will be judged by him. Our lives will go on and now there is a much glorious and wonderful feeling starting to shine over Honokowai Kauhale there is light coming over darkness. AMEN!

  6. Lanakila I hope your comments are based on facts because to use GOD”S name without them will bring everything full circle upon youself.

  7. Hawaiian, as Lanakila said GOD will judge Lisa and Kepa. We have all suffered much pain because of them and we have ALL prayed. The State has ALL the FACTS! Pain has made us ALL stronger and gathered us ALL together to speak up. Please be aware LISA’s actions HAVE COME FULL CIRCLE BACK TO HER!

  8. Hawaiian, my comments are based on truth and facts. Well! just goggle it and you will find out what has been done to not only Honokowai Kauhale but all those unfortunate people that are low incomed with their fixed income as well as the handicap elderly people that she and her family business has abused. Don’t believe me? findout yourself educate yourself know what’s going on in your community and you will see that these are facts, not lies or just rumors. IT’S PERSONAL IF YOU FOUND OUT THAT SOMEONE HAS BEEN STEALING MONEY FROM YOU. And using GOD’s name strenghtens all of us that have been abused, perhaps you haven’t experienced her wrath, So! yes I do use his name to bless her for all that she has done, and hope some day she will find it in her heart to stop this, and to humble herself, to treat people with respect. . As far as it’s full circle to me? IT HAS COME FULL CIRCLE ,HE HAS ANSWERED NOT ONLY MY PRAYERS BUT ALL THAT HAVE SUFFERED FOR TOO LONG. IT’S ABOUT TIME THAT CIRCLE CAME TO A FINAL TURN AROUND. I can sleep at night and know that justice have been served Legal wise, but again as far as GOD and her oh! well go figure. She has bought this Opala upon herself no one else to blame. In time the FULL truth will surface and everyone will know how this started and who was involved!

  9. Theodore and Lanakila I’m glad you are confident enough in all the evidence, to use GOD’s name to pass judement against ALL OF THOSE that you have accused of wrong doing. But thankfully for your sakes IF YOU ARE WRONG all you have to do is pray for his forgiveness which we all know will be given. That’s what makes it so easy to accuse anyone with or without facts when you believe in him as you say you do.

  10. Ke Akua Hoomaikai Oe “Hawaiian”
    Fa’amaile atu you feel that way, but Ou te aloa ia te oe for supporting your sister. Mahalo E Ke Akua No Keia La Mau Loa

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