The visitor industry reacted with shock yesterday to news that a deal to sell the historic Coco Palms Resort had fallen through.
It was rumored several weeks ago that would-be buyer Coco Kaua’i was having trouble rounding up financing in the wake of the terrorist events of Sept. 11, and that property owner Wailua Associates was courting other potential buyers.
This week, rumors of a deal gone bad were confirmed by Jim Reed, Coco Kaua’i managing member. He expressed regret in not being able to bring the redevelopment deal to fruition, but he remained upbeat.
Representatives of Wailua Associates couldn’t be reached for comment Tuesday.
Sue Kanoho, executive director of Kaua’i Visitors Bureau, and Jerry Gibson, general manager of Hyatt Regency Kaua’i Resort and Spa and president of the Hawai’i Hotel Association’s Kaua’i chapter, learned of the dashed deal when told by a reporter.
Kanoho said she’d heard the deal was on hold, not over. She remained confident, though, that the Coco Palms will reopen one day, in some form.
“We were all looking forward to it coming on line, first of all for that part of the island. It’s the grand old resort, and it’s the resort that everybody knows,” said Gibson. “Jim (Reed) had a plan to bring it back in its original state.
“Obviously, something needs to be done with the property, just like they did with the Waiohai over here” in Po’ipu, Gibson said, referring to the old Waiohai hotel being rebuilt as Marriott’s Waiohai Beach Club as a timeshare resort.
Just two hotel properties have no current rebuilding plans since being wrecked by Hurricane ‘Iniki in 1992: The Po’ipu Beach Hotel next to the Waiohai, and Coco Palms.
Gibson said the hotel association is “saddened” that the Coco Palms project isn’t “moving forward. I think it would have been a very good venture.”
“When things stabilize, perhaps the financing issue could be addressed more positively at that time. I think it’s a great location,” even though Kuhio Highway separates it from Wailua Beach, said Gibson.
“I think it will be built, maybe in a better state of the economy. Right now, it’s very hard to go forward when you don’t have the demand,” said Gibson. “And a developer at this point may not be able to see the demand in front of him, obviously,” since the tourism slowdown brought on by Sept. 11.
Reed’s Lincoln Consulting Group had secured Kaua’i County Planning Department and Planning Commission permits to reconstruct the resort as a 232-unit timeshare, with 20 hotel rooms as well.
The permits were issued with several conditions designed to protect known ancient burial sites and other archaeological features on the property, once the stomping grounds of the ruling chiefs of Kaua’i and their families during the Hawaiian monarchy.
The resort’s lagoons were the location of the wedding scene in the Elvis Presley movie “Blue Hawai’i,” filmed there in 1961. And over nine years after the last paying guest left the resort after ‘Iniki, the property still plays host to several “Blue Hawai’i”-style weddings a week. The chapel in the coconut grove behind the hotel is also still a popular wedding site.
Staff Writer Paul C. Curtis can be reached at mailto:pcurtis@pulitzer.net or 245-3681 (ext. 224).
