Previously delayed plans for an affordable rental housing tower on state land in Kaka'ako took a significant step forward this week with the publication of an environmental study that encountered no human burial remains on the property, positioning the $86 million project for an expected construction start next summer.

Developers of the high-rise called Halekauwila Place have submitted a draft environmental assessment to the Hawai'i Housing Finance and Development Corp., and anticipates the 204-unit project will be complete in early 2012.

Halekauwila Place was announced in 2007 and initially projected a 2008 start and 2010 completion.

But the global financial crisis killed the market for tax-exempt bonds that had been lined up to finance the tower for development partners Stanford Carr Development and UniDev LLC.

The developers managed to attract a $71.2 million investment from electrical worker pension plan National Electrical Benefit Fund, and in January they secured a $15 million loan from the Hawai'i Community Development Authority, the state agency guiding redevelopment efforts in Kaka'ako.

In the environmental study published with the state yesterday, the developers reported finding no human remains or other significant cultural artifacts in 18 test trenches dug on the property, each measuring 19.7 feet long and 6.6 feet down to the coral shelf.

However, because of past discoveries of pre-contact burials within a block or two of the project site, the developers propose archaeological monitoring during construction and plan to submit a proposal for this to the State Historic Preservation Division of the Department of Land and Natural Resources for approval.

The project site is now a parking lot on the makai-diamondhead corner of Keawe and Halekauwila streets. The 1.25-acre site is part of a nearly 7-acre block that also includes Mother Waldron Park, a public library system operations building and a closed road owned by a mix of state agencies and the city.

The entire block was the subject of a master plan created in 2000 that envisioned housing, a renovated park and a new elementary school for the property that was the former home of Pohukaina School from about 1912 to 1967.

According to the developer's environmental report, improvements to Mother Waldron Park are scheduled for 2010, and there is no timetable for the school.

Hawai'i Housing Finance selected Halekauwila Place out of four competing proposals for the residential piece of the plan, granting the Carr-UniDev partnership a 65-year land lease at $1 a year.

Halekauwila Place is designed to be a 19-story tower adjacent to a four-story parking garage fronted on two sides with townhouse-style residential units. Several small ground-floor retail spaces are also part of the project.

Units in the project range from 414-square-foot studios to three-bedroom units with 1,382 square feet. Most units have one or two bedrooms.

The project would be available to residents earning 80 percent to 140 percent of Honolulu's median family income, or $76,100 to $111,020 for a family of four at this year's median income.

Under present affordability guidelines, rents could range from $1,331 to $2,886.

As part of the financing arrangement, up to 136 of the units would be made available to tenants for purchase as leasehold condominiums under a rent-to-own program. Purchase prices could range from about $350,000 to $500,000 for a family of four, though median incomes and interest rates at the time of an initial five-year purchase option period will determine prices.