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  From Pacific Business News, December 22, 2003

Coco Palms, Poipu Beach find new life
By Prabha Natarajan

Plans to rebuild two prominent Kauai hotels, destroyed 11 years ago by Hurricane Iniki, are finally coming together, effectively erasing the remnants of the storm's destruction of the island's tourism industry.

Richard Weiser, a South Carolina-based businessman with real-estate interests in Hawaii, expects to sign an agreement to buy Coco Palms Resort Hotel before the end of the year.

CTF Hotels and Resorts, the Hong Kong-based lessor of the Poipu Beach Hotel, plans to apply for county permits in January to reconstruct a 121-room hotel.

"It was exasperating to have a structure abandoned for so long after Hurricane Iniki," said Margy Parker, executive director of the Poipu Beach Resort Association. "Finally, Kauai can erase all evidence of the storm."

New hotel developments can mean only good things for an island looking to grow its visitor arrivals in the next year. For many residents, redevelopment of languishing hotel properties is a welcome economic impetus.

"The sites have been sitting in a derelict condition for so long and serve as a negative reminder of Hurricane Iniki and a blight on the landscape," said state Sen. Gary Hooser, D-Kauai-Niihau.

"Owners have the resources to either develop the property or find a developer," Hooser said. "It's not as if we are dealing with owners without money. Such negligence is an economic drag on the area."

Last year, Hooser pushed unsuccessfully for legislation that would fine owners of commercial property that remained derelict for more than two years. The fines would have been up to $1,000 a day.

Some members of the Knudsen family, the land owners of the Poipu Beach Hotel, sued CTF in 2001 for not rebuilding and reopening the hotel after Hurricane Iniki.

Coco Palms Resort

Many attempts were made over the past decade to sell Coco Palms, a resort made popular by Elvis Presley. The resort, developed in the 1950s, offered a Polynesian setting complete with thatched-roof cottages, coconut trees and rides on outrigger canoes on the Wailua River.

Hurricane Iniki damaged the resort in 1992 and it has remained closed since. Last year, a 60-foot fence had to be built around the resort perimeter to prevent vandalism.

Owner Wailua Associates of Oakland, Calif., has been trying to sell the resort after it battled to get insurance claims on the property after the hurricane.

Since then, there have been many proposals, talks of buyers, but nothing has come through yet. A deal fell through two years ago when Lincoln Consulting Group of California reversed its decision to develop the property.

The timing is right to buy the property, said Weiser, who has been negotiating with the owners for the past few months. He is president and CEO of Weiser Cos. based in Charleston, S.C.

"We have an agreement with the owners and I have a draft contract reflecting the agreement," he said. "We are shooting to have a new contract signed around Christmas."

"I've seen the plans the developer has to rebuild and restore the property to a similar manner it was before," Hooser said.

Some of the developmental challenges with the property include the state's plan to expand the Kuhio highway with a permanent bypass from Hanamaulu to Kapaa. The route chosen for the bypass will impact the property.

One plan for the highway calls for expanding lanes into the property's parking lot, another to its tennis courts and a third to bypass the property. A decision is expected to be made next year.

Weiser said he would release more details on the development once the agreement is signed.

Earlier this year, Weiser, along with Richard Emery of Hawaii First Inc., bought Queen's Court for $3.6 million and converted the vacant downtown Honolulu building into business condos.

Poipu Beach Hotel

CTF Hotels and Resorts, the majority owner of the Renaissance hotel chain, will file for a permit to reconstruct the 129-room property in January.

The Poipu Beach Hotel, one of the oldest hotels on the garden island, was built in the 1960s by Amfac and later acquired by the Stouffer hotel chain. Two of the Knudsen sisters own the land and are part of the discussions to redevelop the property.

This will add a third hotel to Poipu Beach resort, Parker said. The other two hotel chains in the area are Hyatt and Sheraton.

The owners have cleared the debris and plan to renovate the existing structure.

Reach Prabha Natarajan at 808-955-8041 or pnatarajan@bizjournals.com.

All original material © 2003 Cisan Online Ventures/Cisan.Com