Mounting delays in the University of Hawai'i's selection of a developer for critically needed new student housing on the Manoa campus may have set back completion of any new housing by a year.

The first of the housing projects was scheduled to add 800 new beds by August 2007, with a total of 1,800 beds planned by 2009. But late last week, the university acknowledged for the first time that it may not meet the 2007 deadline.

Final negotiations of the housing contract with developer American Campus Communities of Austin, Texas, were supposed to wrap up last month but were extended because an agreement hadn't been worked out, said Carolyn Tanaka, university spokeswoman.

"There is a possibility that the projected fall 2007 opening will be delayed," Tanaka said.

University students, forced to scramble for housing given a severe lack of campus rooms and a tight off-campus rental market, reacted unhappily to the news.

"We desperately need more on-campus housing for students," said Grant Teichman, president of the UH Association of Students. "The people who pay the price for these delays in new housing are the students."

DELAYS PLAGUE PROJECT

The snagged contract negotiations are the latest in a series of delays threatening the timely completion of the student housing.

In June, when the selection process was two months behind schedule, the UH Board of Regents balked at accepting a team of developers that university evaluators and a nationally recognized student-housing expert had ranked as best qualified to design, build and operate the $40 million worth of new accommodations for 1,800 students.

The regents said they needed another month to review the development proposals. In July, they again rejected the top-ranked bidder, a partnership of California-based Actus Lend Lease and Allen & O'Hara Development Co. of Memphis, Tenn., and selected the next-ranked company, American Campus Communities.

William Harris, president of Allen & O'Hara, said he was "dumbfounded" by the regents' decision and predicted that the delayed selection process would make new student housing unavailable for a year beyond the August 2007 target date.

"We told the university in June that meeting the completion date of August 2007 was already very tight, and then they delayed for another month," Harris said. "Delaying the selection decision to July made it definitely too late to meet the 2007 deadline, in my opinion."

New housing must be completed before the fall opening of the 2007 academic year "because after that, students have signed one-year leases for other housing," Harris said. "If you bring in new housing in October or November, you're going to have a project that is mostly empty for a year."

Now, with the contract talks between the university and American Campus Communities extended, the likelihood that the 2007 completion date won't be met has increased.

Jason Wills, American Campus Communities senior vice president in charge of on-campus development, declined comment on the UH housing project, noting that the specifics of the project are still being negotiated.

That's not what student Lawrence Patterson wants to hear. He said he tried for a semester to get on-campus housing at Manoa. He now rents a house in 'Ewa with two Leeward Community College students and commutes to campus.

"The rent I pay is a good deal, but if I had a place on campus I wouldn't have to worry about things like buying food and paying electric bills," Patterson said. "And there'd be a sense of belonging that you don't get living off-campus. They need more housing."

BID PROCESS IN QUESTION

American Campus Communities' selection for the new contract came after an evaluation committee made up of UH administrators and national student-housing expert Gregory Strickler had ranked the Actus Lend Lease/Allen & O'Hara team as best qualified for the work, according to UH records.

Actus Lend Lease is heavily involved in building and operating military housing on the Mainland and in Hawai'i. Allen & O'Hara specializes in the design and management of on- and off-campus student housing.

American Campus Communities, like Allen & O'Hara, is a real-estate investment trust that specializes in student housing nationwide. The company has developed or managed nearly 29,000 beds of student housing.

After the regents selected American Campus Communities, Harris said his company and other members of the Actus team attended an Aug. 5 debriefing session on the contract selection process conducted by university personnel.

"We learned very little except for being able to see where our proposal was ranked by the evaluation committee," he said.

"They gave us the highest score, we were the highest team in virtually every category. But we did not really learn anything about why the regents decided somebody else should be hired.

"I don't feel we were treated fairly, and I doubt very seriously whether we would ever pursue another contract with the University of Hawai'i," he said.

The university has not revealed why the regents rejected the Actus/Allen & O'Hara proposal and selected American Campus Communities.

In its written statement, UH said the evaluation committee's findings were advisory only and that the final decision was the responsibility of the regents. But UH spokeswoman Mia Noguchi was unable to cite another instance in which the regents overturned a selection by UH administrators of a developer for a large capital improvement project.

Because the two top finalists "emerged as well-qualified and substantially similar," they were ordered to return to the July regents meeting and make oral presentations about their proposals, the university said in its statement.

UNANIMOUS SELECTION

"Following the presentations, a vote was taken publicly and American Campus Communities was selected," the university said. The regents voted unanimously in favor of American Campus Communities, with members Kitty Lagareta and Ronald Migita excusing themselves from the vote because of real or potential conflicts of interest.

Lagareta, a public relations consultant, said she has a previous business relationship with Actus. And Migita, chairman of the board of Central Pacific Bank, also cited a business connection to Actus in excusing himself from the decision, Lagareta said.

Regent Allan Landon, chairman and chief executive of Bank of Hawaii, was attending his first meeting of the board and abstained from voting, according to Lagareta.

Bennette Evangelista, spokeswoman for Actus, said: "We are disappointed not just with the outcome, but with the process. We don't really understand what happened."

EVALUATORS OVERRULED

Harris, of Allen & O'Hara, said in early June the regents received an anonymous letter that questioned the fairness of the evaluation process, made false allegations about Actus and Allen & O'Hara, and recommended American Campus Communities for the contract.

Harris wondered if the letter affected the regents' decision.

The letter, which touted American Campus Communities as "the only non-risk candidate" for the contract, was forwarded by the regents June 8 "to the UH administration for review and feedback," according to UH.

That review wasn't completed until July 11.

"Upon investigation by UH officials, the issues of concern raised within the letter were determined to have no basis," the university said. "The board was satisfied with the administration's response and took no negative actions as a result of the letter."

Harris has his doubts, however. "The results turned out to be just what this letter was advocating," he said.

The UH evaluation committee that recommended Actus for the project was made up of six university officials, including Jan Yokota, head of the UH Office of Capital Improvements, and private consultant Strickler.

The process was initially delayed after the list of five finalists was reduced to three development teams. They were then required to submit expanded plans.

The evaluation committee selected the Actus/Allen & O'Hara team as best-qualified for the project and submitted its results to the regents at their June 21 meeting. The regents balked at approving the Actus/Allen & O'Hara team.

"This being such a hot, visible project, we want to make sure we choose the best ... and (what) the selectee (Actus) brought forward was not the best," Regent Andres Albano Jr. said after the meeting.

The regents told the two finalists — Actus/Allen & O'Hara and American Campus Communities — to make oral presentations at the regents' July meeting.

At that meeting, the regents said that the board took the extra time with the student-housing developer selection because of its importance.

As part of its presentation to the regents, Actus noted that it was funding financial scholarships for UH students.

Regent Jane Tatibouet said she was "uncomfortable" with the company's inclusion of the scholarship information in its bid. She also faulted Actus for focusing more on aesthetics than finances in its oral presentation.

Members of the evaluation committee declined to comment on the selection process, deferring to the university, which said in its written statement that the developer selection process was "open, fair and based on merit."

The UH housing project involves rebuilding or replacing the Frear, International Gateway and Johnson Hall dormitories along Dole Street.

Frear Hall, built in 1952, has been closed since 1996 because it had deteriorated to an uninhabitable state. The hall is to be entirely renovated or rebuilt.

At the July board meeting, regent Tatibouet said the public perceives the Manoa dormitories to be "a disgrace."

"I want people to look at this (selection) decision and say, 'Finally, UH has its act together,' " Tatibouet said.

Teichman, of the UH students association, however, has a different take: "It's a bureaucracy of molasses."

LODGING INFORMATION

For University of Hawai'i- Manoa on-campus and off-campus housing information, including instructions for listing an available rental, see www.housing.hawaii.edu.

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If you have an investigative story tip, reach Jim Dooley at 535-2447 or jdooley@honoluluadvertiser.com.

Reach Jim Dooley at jdooley@honoluluadvertiser.com.