City officials say its $142 million affordable housing deal has been called off.
City Managing Director Ember Shinn says the proposed buyer, Honolulu Affordable Housing Preservation Initiative (HAHPI), terminated the transaction in a letter received on Thursday.
The deal involved selling Honolulu's 12 leasehold public apartment complexes to the private group.
HAHPI says it would not be able to come up with a $35 million payment by the March 31 deadline.
City officials say they are most concerned about the impact this will have on its Housing First Initiative, which would develop housing for the homeless.