LIHUE — In order to give Coco Palms developers time to make sure finances are in order to start demolition on the hotel, the Kauai County Planning Commission voted Tuesday to defer the topic until next week.
“We need to resolve the future of the sight,” said Commissioner Wayne Katayama. “This next week is critical.”
John Pang and Tyler Greene, representatives from Coco Palms Hui, LLC., told the commission that despite some setbacks, including their main source of funding for the demolition pulling out due to health problems, the company has the funds necessary to start the $135 million project.
“At the last meeting, we had gotten a commitment from a lender to fund the acquisition, as well as the demolition of the project, but the principal person involved with the lender went to the hospital,” Pang said.
Greene added: “We spent nine months with this lender, underwriting the deal, getting the approval, submitting our tax returns, all with the understanding that our loan was approved. In fact, in March, we received an email with them that they would foreclose by the end of the month.”
But the main person involved in the loan suffered from congestive heart failure, Greene said.
“The long and short of it is that we had a complete lender blow-out,” he said. “So in the last four weeks, we had to try to scramble around to find a new lender to come in. We needed someone who was willing to do business on Kauai and understood the hotel market.”
That “someone” is a company out of Utah, called Private Capital, which will be funding the demolition amount of the project, Greene said.
The demo price is almost $3.5 million.
All of the necessary documents have been deposited into escrow, Pang added.
“Once we get that money, escrow will be able to immediately schedule closing documents,” he said. “By state law, there’s a 48-hour wait period to get funds in.”
Demolition will start right after closing.
It will take six months to complete demolition, and the resort is slated to open in early 2018, Greene said.
The plan is to restore the resort, which was destroyed by Hurricane Iniki in 1992, to its former glory.
On Tuesday, some planning commissioners voiced concerns on the project, saying they hoped for a better plan.
“There seems to be a lot of ‘if this happens,’” said Sean Mahoney, chair of the Planning Commission. “I was expecting more of a concrete plan; this doesn’t seem much different from when you were here the last time.”
Louis Abrams, vice-chair of the Planning Commission, said he would like to see the loan documents.
“I’d like to see has it been sent, has it been received, who it’s from,” he said. “At this point, I don’t know if I’m anymore convinced now than I was then. I appreciate the effort, but so far, not so good. I’d like to see this done, but I’m losing faith.”
But Pang said the company is closer to getting a loan because they have the funds, which they didn’t have when they met with the commission in February.
“We’re on the precipice of getting this closed,” he said.
Mike Dahilig, planning director, said it would be in the commission’s best interest to give the new financing option time to shape up.
“It’s not unreasonable to allow the opportunity for some of the items to be realized,” he said.
The Planning Commission will meet with Coco Palms Hui, LLC. again on Monday to get an update on the loan from Private Capital.