Plans for a new retirement community in Nu'uanu cleared a hurdle last week with the state authorizing special purpose revenue bonds to help fund the development aimed at moderate-income senior citizens.

A measure signed by Gov. Linda Lingle allows for the sale of up to $120 million of the bonds, proceeds of which will be used to build a 171-unit continuing care retirement community and 41-bed long-term care facility. The project, known as 15 Craigside, is scheduled to break ground late this year or early next and be completed by the end of 2009.

"We're just so pleased," said Emmett White, head of the project and also president and chief executive officer of the Arcadia retirement facility on Punahou Street. He said the new facility addresses a market for people who can't afford to move into higher-priced continuing care facilities such as Kahala Nui in Kahala or the planned Leihano project in Kapolei.

"What we try and do is appeal to the moderate income market," said White.

The new development will help fill some of the demand for retirement facilities. Healthcare experts say the state has a great need for senior living facilities of all types and that the need will grow in coming years. Some studies have forecast Hawai'i's senior citizen population growing at a faster rate than the nation as a whole.

The 15 Craigside project is planned for 1.5 acres next to the existing Craigside condominiums in Nu'uanu. White said the project's taken 70 deposits since sales started last September with sales expected to accelerate now that Lingle has signed the bond legislation into law.

The project is structured so that residents pay a nonrefundable entry fee that starts at about $150,000 for a single, with higher fees for couples.

People have their choice of either 480-square foot studio apartments or 640-square foot one-bedroom apartments.

Residents will also pay a monthly fee ranging between $2,300 and $3,500 to take care of three daily meals, weekly maid and linen service, maintenance, utilities and general healthcare protection. Higher fees will be charged people who require assisted living or long-term care.

White said he expects to reach a presale goal of about 125 units this year and is negotiating with Ziegler Capital Markets about issuing the tax-exempt bonds that will finance the non-profit entity developing the project.

The project is being developed on land previously occupied by the Hawaii Conference Foundation of the United Church of Christ. The foundation moved from the site last year after signing an agreement for the Arcadia Foundation, Arcadia Elder Services and a new corporation, Craigside Retirement Residence, to develop and operate the retirement facility.

Reach Greg Wiles at gwiles@honoluluadvertiser.com.