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Honolulu Mayor Kirk Caldwell announced Monday that the city has reached a new development agreement with Michaels Development Company for the city’s affordable rental senior project in Chinatown.

The city has been negotiating with Michaels Development for the last six months, and now the new agreement goes next to the Honolulu City Council for consideration.

“Reaching this agreement with Michaels Development is a major milestone in the city’s efforts to develop affordable senior housing,” the mayor said in a press release. “Halewai‘olu Senior Residences is an outstanding project that can provide greatly needed affordable senior rentals in a manner consistent with the desires of the neighboring community and our values as an island.”

According to the press release, the developer plans to build “two mid-rise towers that share an elevator core, a parking garage and a recreation deck, with a street-level community center and retail space, in a style that complements Chinatown’s unique character and sense of place.”

The $49 million project will provide 151 rental housing units to people over the age of 62 who earn up to 80 percent of the area median income ($53,700 for an individual). Most of those units — 135 — will be set aside for people earning no more than 60 percent of area median income ($40,260).

The lease term would last 65 years and could be extended up to 75 years. For the first 30 years, Michael Development will pay the city $1,614.00 per year in rent. The developer plans to apply for state and federal subsidies for the project.