HANALEI — Apartment owners voted to oust Hanalei Bay Resort’s management company earlier this year, but the request has seemingly gone unanswered. Several allegations have recently been made by timeshare and full-time condo owners regarding Celebrity Resorts’ involvement with the
HANALEI — Apartment owners voted to oust Hanalei Bay Resort’s management company earlier this year, but the request has seemingly gone unanswered.
Several allegations have recently been made by timeshare and full-time condo owners regarding Celebrity Resorts’ involvement with the 30-year-old property.
“If an overwhelming majority of owners don’t want you around, I can’t imagine why you would want to stay,” said timeshare owner Peter Somerville. “Celebrity has refused to vacate.”
After taking over Quintus Vacation Management’s contract last August — without prior notification to either the Board of Directors for the Hanalei Bay Resort Vacation Owners Association or the Association of Apartment Owners — Celebrity has faced turmoil as the property’s condition continues to decline, according to multiple sources.
“We were told he (Gary Grottke, principal of Quintus and resort developer) wasn’t actively marketing the resort and were shocked to learn that someone would purchase a management company without contacting the board members,” Somerville said last week. “If they’re willing to take that risk, there must be a lot of money involved.”
A Celebrity Resorts spokesperson reached this week did not provide comment by press time.
Both the VOA and AOAO have since unified against Celebrity Resorts for several reasons, according to Somerville.
One reason they seek to terminate the management company’s contract is its inability to recognize board members of the VOA, including Somerville, elected prior to management transitions.
Instead, Celebrity Resorts appointed its own board members, including three of the company’s senior officers.
“Our board has had some ongoing discussion with Celebrity management about amending management agreements so that they work for the board and not the other way around,” said full-time owner and AOAO President Kent Oehm. “We were unable to reach an agreement and we may have to resort to legal actions.”
Legal actions that have already taken place concern a petition filed in court to determine the legitimate board of directors for the VOA.
“Hanalei Bay Resort should be run by boards consisting of individual owners and in a fiscally approved manner, where management companies report to owners,” Somerville said. “It’s a conflict of interest to serve on the board of a property in which they manage.”
State Sen. Gary Hooser has also assisted concerned citizens, and after receiving several phone calls and e-mails from timeshare owners making various allegations about the management company, a letter was forwarded to “appropriate state agencies.”
“It’s my duty and responsibility to follow up on the issue,” Hooser said in a phone interview Friday. “I have not dug into the situation and don’t know who’s right and who’s wrong, I just know that a lot of people have raised the issue.”
While AOAO board members are still recognized, Oehm said, they have also been left in the dark on a number of matters, such as financial information.
“We really feel the management company should report directly to the board,” he said.
Somerville said the budget had to be “forced” out of Celebrity, only to find that they were operating at a deficit in 2008, “despite having raised our fees.”
“We wanted to know where our money was going,” he said, adding that general excise taxes have allegedly not been paid by either Quintus or Celebrity and he has been pushing for an audit.
“Celebrity also refuses to provide us with a list of owners which, in my opinion, is to keep control,” he added.
Concerns have also been raised over the property’s demise in recent years, which have not gone unnoticed by both residents and visitors alike.
“That’s one of the reasons I wanted to get on the board, is to turn things around,” Somerville said, adding that timeshare units remain “moldy” and outdated.
“There are no reserve funds for renovations, despite paying fees comparable, if not higher than other Princeville timeshares,” he said.
Oehm said that once the “management situation is resolved,” the possibility of updating timeshare units could increase, which would be beneficial to both full-time and part-time property owners.
He also adds that the resorts’ restaurants have been “held hostage,” as Celebrity now owns the Bali Hai restaurant and Happy Talk Lounge, both of which have remained closed.
“We’ve been trying to keep the resort going and one of things we’re concerned about is getting the restaurants open,” Oehm said.
Sources say the lounge is expected to open mid-July to early August, although it could not be confirmed by press time.
“It disturbs me that things are not getting better with Celebrity in charge,” Somerville said. “It’s a unique property, one of the most beautiful places I’ve ever been to; it’s a shame.”
