Obayashi Corporation of Japan’s Sheraton Kauai on Po‘ipu Beach is now owned by the company that has managed it for many years, Starwood Hotels & Resorts Worldwide, Inc.
Starwood finalized its purchase of the 413-room beach-front resort Wednesday in a deal valued at $40 million.
Starwood has served as manager of the hotel using its Sheraton brand for Obayashi for years.
“It’s going to continue as the Sheraton Kauai,” operating as a hotel and not a timeshare resort, said David Uchiyama, regional director of communications for Starwood.
Employees now under Obayashi will become Starwood employees in the “seamless” transition, he said.
“We’re very happy with that property, and that’s largely the reason we decided to purchase the property,” Uchiyama said.
Starwood leaders are also happy with Sheraton Kauai General Manager Charldon Thomas, who like the other employees are expected to remain with the property.
“He’s been great for the community as well,” Uchiyama said of Thomas.
Obayashi spent about $40 million to restore the property following damage from Hurricane ‘Iniki in 1992, according to a report from the state Department of Business, Economic Development and Tourism.
The Sheraton Kauai reopened in December 1997 after being closed for four years after the September 1992 hurricane. The entire Beach Wing of the resort was made new, along with the addition of a beach-front pool.
Obayashi enjoyed one of the longest terms of ownership of a hotel in Kaua‘i’s modern tourism era.
“We are pleased to acquire this resort property at a very attractive price per key representing a discount to replacement cost,” said Ted Darnall, president of Starwood Real Estate.
“Acquiring this resort reinforces our strategic commitment to Kaua‘i and the Hawaiian Islands, which remain the most important leisure destinations for U.S. travelers.”
In October, representatives of Starwood Vacation Ownership Inc. were reported to be looking at buying additional Southshore property adjacent to the hotel, with the intent of building a new timeshare property.
The company’s first Hawai‘i timeshare project is the Westin Kaanapali Ocean Resort Villas on Maui which opened last fall. The company also plans to build around 300 luxury timeshare condominiums on resort-zoned land at Princeville, overlooking ‘Anini Beach.
In October, Keith Vieira, Starwood’s vice president and director of operations in Hawai‘i, said, “we are looking at a number of options” in Po‘ipu.
“Part (of the additional land) could be used for a timeshare (resort). But right now, we are in the discussion phase,” he said.
At the time, Obayashi Corp. representatives said they were considering offers from Starwood officials and others for transfer of the property.
Starwood is currently in the planning phase of a timeshare property on an 18.5-acre parcel at Princeville that overlooks ‘Anini Beach.
The company purchased the resort-zoned lot in August of 2002 from Princeville Corporation for $15 million. The parcel is zoned for 370 timeshare units or 740 hotel rooms.
Starwood officials said they have plans to sell ownership in the upscale, two-bedroom units for $40,000 to $50,000 a week.
The Sheraton Kauai Resort is one of 14 Starwood Hotels in Hawai‘i, including the Princeville Resort. Sheraton’s Hawai‘i Web site is www.sheraton.com/hawaii.
