KAUAI (HawaiiNewsNow) - Plans to redevelop the former Coco Palms resort have fallen through due to financial issues ― and now the historic property is up for sale.
A representative for Stillwater Equity Partners, the Utah-based firm now managing the site, said GreeneWaters, the property’s owners and developers, defaulted on a $11.2 million loan used to finance the project.
But Tyler Greene, GreeneWaters’ managing partner, says the project is not dead yet.
In a statement, Greene said they “decided to put the property on the market in order to give a willing and able buyer or a joint venture partner an opportunity to step in and move faster than the project is currently going.”
Stillwater says they’re looking for buyers or partners with hotel experience -- both in the U.S. and internationally -- who can “contribute the capital and resources needed to make Coco Palms an iconic hotel as it once was.” They’re also exploring other options to “maximize the value for existing shareholders.”
Kauai Mayor Derek Kawakami, who is disappointed but not surprised by the news, says he’ll be keeping an eye on potential buyers.
“That’s always on the top of our mind -- who’s going to be coming in and will they be good neighbors," said Kawakami. “Are they going to be respectful or are they going to be one of those people that walk in our living room with their shoes on.”
Kawakami says he county does not have the funding to purchase and clean up the property, and he believes a resort is no longer the best fit for the location.
“When you talk about our traffic issues, how is it going to impact traffic? And logistically, it would be hard to see how they would market that property as a visitor destination considering there’s a very dangerous beach that not even I will allow my children to swim at,” Kawakami said.
The resort ― widely known for its lagoon made popular in an Elvis movie — was destroyed 27 years ago when Hurricane Iniki tore through Kauai.
In the years since, the property has sat vacant, with only the shell of the resort still standing.
A $150 million project to revive the hotel has hit a number of big snags, including legal fights and community protests. Among the biggest delays: Those occupying the property refused to leave.
Developers had hoped to reopen the hotel by the end of 2020. Plans also called for retails shops and other attractions.
Stillwater Equity Partners said it hopes to work with the Kauai County Planning Commission to determine how to move forward as a buyer is sought.
The group is also working to clear the front of the hotel and parking lot “to minimize its dilapidated appearance and improve the overall image to potential investors as well as local residents.”
The county said rumors of the default had been circulating for weeks.