Starwood buys St. Regis

PRINCEVILLE — Starwood Capital Group announced Friday that it has acquired the St. Regis Princeville Resort. Starwood Capital Group’s hotel management company, SH Hotels &Resorts, will operate the hotel effective immediately as Princeville Resort.

Starwood intends to invest more than $100 million to transform the property into what could be the “1 Hotel” brand’s flagship resort, 1 Hotel Hanalei Bay. 1 Hotels are in Manhattan, Brooklyn, New York and South Beach, Fla.

“1 Hotels is a luxury lifestyle hotel brand that is inspired by the majesty found in nature,” according to a press release.

The resort will feature a world-class wellness center, oversized fitness area with both indoor and outdoor programming, and a diverse activity center to allow guests to discover their own individual balance between activity and relaxation.

“We are just thrilled to have this opportunity to acquire and create what will surely be one of the most incredible resort properties in the world, 1 Hotel Hanalei Bay,” said Barry Sternlicht, chairman of Starwood Capital Group. “There is no better location, nor more perfect microclimate, to create a wellness resort that will reinvigorate our guests and celebrate the intoxicating beauty of nature.”

Sale of the hotel and golf course was first reported by The Garden Island in late July, though confusion had remained about whether Starwood, based in Greenwich, Conn., was the buyer. However, in an email responding to questions about the transaction, a consultant to the Los Angeles County Employees Retirement Association confirmed the buyer’s identity.

“Starwood is the buyer, but the transaction has not closed,” he said. “A close date is targeted in November.”

In a story by Allan Parachini, The Garden Island reported on Sept. 14 that Starwood had struck a deal to buy the St. Regis Princeville Resort, although Starwood declined to confirm it then.

Princeville Resort has 251 guest rooms and suites. The hotel has sweeping views of lush gardens, mountains and the Hanalei Bay. It offers five dining locations as well as the Haleleʻa Spa. Princeville guests have preferential access to the Princeville Makai Golf Club.

East West Partners, a long-time collaborator with Starwood Capital Group, will partner in planning and development.

“We are very proud to have the opportunity to be a part of this incredible project and look forward to partnering once again with Starwood Capital Group,” said Harry Frampton, founder of East West Partners.

The acquisition price was not disclosed, but LACERA purchased the properties in 2005 for $93.7 million, according to Kauai County tax records. An internal listing of all of LACERA’s real estate holdings, dated Sept. 30, 2017, put the current value of the St. Regis/Makai Golf complex at just under $212 million.

When word of the imminent sale first became public in late July, the speculated purchase price was $225 million.

The St. Regis Resort and Makai Golf Club employ a total of about 600 people, making the complex one of the North Shore’s largest employers. The hotel has averaged about 80 percent occupancy over the last five years.

The hotel covers 23 acres that front Hanalei Bay. The nearby golf course covers 290 acres of prime Princeville land.

Starwood Capital was founded in 1991 by Barry Sternlicht, a veteran hotel executive. The company founded Starwood Hotels and Resorts, but spun off the subsidiary in 2015 to Marriott International for $13.6 billion.