The Makena Beach and Golf Resort will be sold at auction under an order issued by a Maui Judge.
Circuit Court Judge Shackley Raffetto appointed Honolulu real estate developer and broker Cris Lau as Commissioner to sell the property in an effort to satisfy the unpaid mortgage debt on the property.
The marketing company for the property issued a media release today saying the property is expected to be sold at public auction in April 2010 to pay the current mortgage dept in excess of $192.5 million.
The resort, formerly known as the Maui Prince Hotel, is located on the slopes of Haleakala and includes substantial property adjacent to a secluded beach on the southwestern Maui coast.
”While ownership of the property will change hands, no one expects any changes for employees, visitors and guests,” the release said. Chris Lau, the court appointed commissioner, stated, “My job, ordered by the court, is to transition ownership since the current owners could not pay the mortgage. I expect the resort to operate ‘business as usual’ throughout this process.”
The hotel has been managed by Benchmark Hospitality International since September 17, 2009 with oversight by attorney Miles Furutani, the court appointed receiver.
Kelly Lewis, general manager of the Makena Beach and Golf Resort, said, “The performance at the resort has improved substantially. We are excited about the improvements we have been able to offer in guest experience and look forward to announcing our new restaurant and lounge offerings next month.”
Barry Sullivan, attorney for the foreclosing lender, stated, “We have complete confidence in Mr. Lau and look forward to concluding this process over the coming months. Thanks to the work of Benchmark and the receiver appointed last September, resort performance has not only stabilized but we see very positive momentum and we look forward to that continuing,” said Sullivan.
After the auction is held, confirmation by the court and closing is expected to take another three to four months.
The resort has been owned since July of 2007 by a joint venture between affiliates of Everett Dowling and a Morgan Stanley real estate fund. That venture borrowed $192.5 million of mortgage debt and an additional $227 million of debt that was not secured by the mortgage.
Wells Fargo, as trustee for the mortgage debt, initiated foreclosure in August of 2009 after the venture defaulted on its mortgage and other debt obligations. To oversee resort operations and transition to new management, court-appointed receiver Miles Furutani will remain in possession of the resort until closing with the new owner.
(Posted by Wendy Osher)
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