The continuing economic downturn in Japan is forcing the owner of Kauai Lagoons Resort Company, Ltd. to sell 452 acres of land near Lihu’e Airport and the Kauai Marriott Resort. In a loan-restructuring move, representatives of parent company Shinwa Golf
The continuing economic downturn in Japan is forcing the owner of Kauai Lagoons Resort Company, Ltd. to sell 452 acres of land near Lihu’e Airport and the Kauai Marriott Resort.
In a loan-restructuring move, representatives of parent company Shinwa Golf Group and Shinwa Golf Hawaii have reluctantly consented to allow a Japan government agency to sell all its Hawai’i holdings.
The Kaua’i land includes the 18-hole Kiele and 18-hole Mokihana golf courses at Kauai Lagoons, plus a site already zoned to allow construction of a 750-room hotel.
The Hawai’i assets of Shinwa Golf Group, owner of Kauai Lagoons, will be sold as a result of a loan-restructuring agreement between the Kyoto-based corporation and the Japanese government’s Resolution and Collection Corporation (RCC).
Shinwa’s Hawai’i major property in Hawai’i is the Renaissance Wailea Beach Resort hotel on Maui, which will also be sold along with the Wailea Golf Course and other lands in the Wailea area.
The company announced that Kauai Lagoons will continue its resort operations, mainly operating the two golf courses, and retain all its current employees, until the sale is completed, estimated to be sometime next year.
Shinwa acquired in 1991 for around $250 million the golf courses from a corporation formed by developer Chris Hemmeter.
“Our Hawai’i operations on Maui and Kaua’i continue to do very well,” said Carl Uesugi, president of Shinwa Golf Hawaii.
“We will continue to operate and manage the Hawai’i properties as usual until the sale is completed sometime next year,” Uesugi said.
“When Shinwa began its acquisition of properties in Hawai’i, we looked forward to a long and productive relationship,” said Mitsuo Kokufu, owner of Shinwa Golf Group.
It is not known at this time whether or not the properties on Maui and Kaua’i will be sold as one package, or split up into smaller parcels. The RCC, a department of the Deposit Insurance Corporation of Japan, is handling the sale.
No potential buyers have been identified.
The pending sale casts doubt on proposed development changes Kauai Lagoons planned for, and recently won approval for, before both the Planning Commission and County Council.
The development activities have been put on hold pending the sale, a Shinwa spokesperson said.
The Kauai Lagoons parcel contains lands zoned for resort, residential, commercial, limited industrial, other industrial and open-space uses.
Representatives of Shinwa said the changes in the Kauai Lagoons master plan are good ideas and include moving the hotel site further from the airport and getting a designation that allows timeshare development. The company hopes a new owner will implement those plans.
The company’s Hawai’i assets have been operating profitably, but economic slow down in Japan has created a need for the company to restructure its debt obligations.
RCC acquired Shinwa Golf Group’s loans in August of 2000 following the collapse of several Japanese financial institutions, including the Nippon Credit Bank, Shinwa’s principal lender.
Under the agreement, Shinwa will continue to own and operate eight golf courses in Japan, and repay its debt over a 12-year period.
The Deposit Insurance Corporation of Japan is similar to the U.S. Federal Deposit Insurance Corporation and protects savings deposits of citizens. The regulatory agency has taken on added responsibilities in Japan as a result of multiple bank failures brought on by the country’s struggling economy.
Staff Writer Paul C. Curtis can be reached at mailto:pcurtis@pulitzer.net or 245-3681 (ext. 224).
