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Coco Palms rebirth still alive

WAILUA — The Utah private-equity company that has taken over the ruins of the former Coco Palms Resort in Wailua says it is moving ahead with plans to rebuild the property as a hotel and can meet an Aug. 31 county deadline to submit 26 different building permit applications.

At the same time, Stillwater Equity Partners, which took over Coco Palms after the Coco Palms Hui investment group defaulted on more than $22 million in financing, says it is working with the Kauai Police Department to control drug dealing and other illegal activity on the property that has thrived as the abandoned hotel sits vacant along Kuhio Highway.

These developments were described on Tuesday during an annual project update delivered by Stillwater to the Planning Commission, which could revoke Coco Palms zoning development rights if it does not meet the Aug. 31 deadline. That could essentially be the death knell of the long-touted effort by Coco Palms Hui and now Stillwater to rebuild and reopen the resort.

The update was delivered by Jon Pang, a lawyer representing Coco Palms, and Christian Zundel, Stillwater’s local representative heading the project. The Planning Commission also heard from Ron Agor, the architect who says he is redesigning Coco Palms as an updated, 350-room resort and rebuilding cottages on the property that were once the preferred accommodations of celebrities like Elvis Presley.

In March, Stillwater disclosed that Coco Palms Hui, founded by Oahu developers Tyler Greene and Chad Waters, had defaulted on more than $22 million in debt and was unable to proceed with its redevelopment plans. Stillwater stepped in and assumed control of Coco Palms Hui, but it had been unclear what the equity firm’s actual plan was.

Agor said that, as of Tuesday morning, 20 of the 26 required permit applications had been filed with the county. Neither Pang nor Zundel would identify any contractor who might be involved in actually building the resort.

Asked directly by a Planning Commission member if Stillwater actually has the financing to move forward with the project, Pang responded: “Yes, ma’am.”

Pang and Zundel said Stillwater has been in discussions with hotel operators who might take over the project or enter into management agreements. They declined to identify any such hotel corporation by name.

However, TGI has learned that there have been at least preliminary talks between Stillwater and Koa Kea Hotel &Resort in Poipu, which is part of the mainland-based Meritage Collection, an upscale hotel chain. It was not clear when such talks occurred or what their result was, nor is it known how many other resort-management corporations may have had discussions with Stillwater.

Both Jack Slim, Koa Kea’s general manager, and Giovanni Prada, its California-based marketing director, declined to comment on the report that Koa Kea has expressed interest in Coco Palms or to say what the resort company’s plans for the resort might be.

Pang and Zundel specifically declined to say whether Hyatt Hotels, which in 2014 announced a management agreement with Coco Palms Hui, was still involved in the project. Attempts to reach Hyatt were unsuccessful.

Zundel did not respond to a series of follow-up questions from TGI regarding any firm plans or specific potential partners Stillwater may have.

“We are prepared to take this project all the way to completion,” Zundel told the commission.

Moreover, said Pang, Stillwater is “fully aware of the conditions” that require all building permits to be submitted for county review by Aug. 31. Ka‘aina Hull, county planning director, said that if the permits are not in order by that date, Coco Palms could lose its zoning permit, which could potentially sink the project.

The zoning consideration is important because it would permit Coco Palms to rebuild on essentially the same footprint it had when Hurricane Iniki damaged the property in 1992. Despite the passage of time, Coco Palms remains largely grandfathered from updated building code requirements. It still must meet some modern standards relating to its location in the tsunami zone.

Should that zoning status be revoked, Coco Palms would have to start the process completely anew and meet standards that would apply as if the hotel was being built from scratch today. Such requirements could possibly make recreating Coco Palms infeasible.

Hull said that if Coco Palms misses the Aug. 31 deadline, the Planning Commission could still issue an extension of the deadline, but the mood at Tuesday’s meeting appeared to make clear that the five commission members, including the chair, Sean Mahoney, are disinclined to give Coco Palms more time past the August date.

Zundel said he is working with both the Kauai Police Department and Kauai Fire Department to get better control over the abandoned hotel.

“The drug use and criminal behavior has been a problem,” he said.

He said KPD has committed to paying closer attention to problems on the property. He and Pang said the fire department had expressed interest in burning down some structures that remain on the property for use in training exercises.

“We’re working to keep all squatters” off the property, Zundel said.

In responses to a query from TGI, KPD said: “In May of this year, in response to community concerns about possible illegal activity on the Coco Palms property, KPD reached out to the president of Stillwater Equity Partners, which is now managing the property. In June, KPD personnel met with Stillwater representatives at the Coco Palms site to discuss potential safety measures that might help to deter illegal activity, such as installing fencing, boulders and additional ‘No Trespassing’ signs.”

Pang said that Greene and Waters, the former heads of Coco Palms Hui, remain involved in the project and may have an equity interest. However, Waters and Greene are no longer involved in operations or planning for the construction, Pang said.

Coco Palms sits on 20 acres of prime oceanfront land that are effectively owned by Stillwater as a result of the default. The resort property also includes an additional 14.8 acres of land leased from the state Department of Land and Natural Resources.

A potential challenge for Stillwater could be that DLNR would have to approve any change in the identity of the lessee of the land — which would require a vote by the state Board of Land and Natural Resources.

•••

Allan Parachini is a Kilauea resident, journalist, furniture maker and retired public relations executive who writes occasionally for The Garden Island.

10 Comments
  1. Palani August 15, 2019 2:09 am Reply

    You can be sure that if Ron Agor is the architect on the project, it will never be built on time, if ever.


    1. Jjjames August 18, 2019 7:43 am Reply

      I wonder how the EIS will address “sea level rise”.


  2. Kauaidoug August 15, 2019 7:46 am Reply

    Here we go, again! Fix Kapaa crawl first before 350 rooms and cars and people are added to the already crowded road.


  3. Wa Hine August 15, 2019 12:29 pm Reply

    What a joke! Every time one of the permits is about to expire, GI publishes an article or commentary about how the developer is making progress and that Coco Palms is still alive. Get over it already its never going to happen.


  4. commonsense August 15, 2019 12:50 pm Reply

    I’m curious as to how much money the county will require the developers to contribute to infrastructure improvements to accommodate the increased traffic and impact on water and sewage. In my opinion, I think this project as a hotel is destined for failure and/or a big headache for people living in the area and anyone travelling through that corridor.


  5. Debra Kekaualua August 15, 2019 1:52 pm Reply

    What part of “Game Over” or “NO” or “DeOccupy” do these corporate voter citizens not understand? It is all overdue for Akua to bless the people that have for so many decades been at war with the greatest bully-terrorist regime on the planet. In this case, the original folks from Utah, Mormons, have supported the Ruse and we know more thoroughly what their insatiable motivation or involvement is in the bigger picture being played out as Warrior continue to “claim” our inherent rights aloha aina. Recently, TGI posted that DOFA “closed until further notice” Loop Road, “blue hole”. Mauka before 2nd crossing was reopened, to where the cancelled KIUC lesee, ditchman house parcel at the Waialeale basin. There are also several legal signages posted regarding Wailuanuiahoano Ahupua’a and all lands are pending similar signages in metal format due to the many that have been recently stolen. Every nano-inch belongs to the Our people, never to other nations, the Utah group or anyone else for that matter.

    It is time for cocopalms investors to bring in the contracted archeologists. This means that our laws, our constitution, and our Game On plans will be implemented. Alongside the thousands of known archeological artifacts and unyet unearthed kupuna iwi inventory, the inning of this Game, like the “stolen mailbox”, will shut this project down so fast heads will spin.


  6. Suzan Kelsey August 15, 2019 2:44 pm Reply

    Once again, Lucy positions the football…..


  7. Norm Smith August 15, 2019 3:52 pm Reply

    If Kauians are truly serious about controlling the influx of tourist traffic… Then they should be willing to pay more taxes to create a State park at Coco Palms.That is as simple as it gets. Money talks Bu….Sh……walks


  8. Sally ann September 7, 2019 11:03 pm Reply

    What happened with the Royal Patent claim court case?


  9. Kathryn Jones November 12, 2019 11:36 am Reply

    Are there any updates?


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