Hotel Hana-Maui sold to San Francisco resort firm

By Christie Wilson
Neighbor Island Editor

The Hotel Hana-Maui will get another chance to restore its reputation as an exclusive, luxury hideaway when a new owner takes over for the second time in less than two years.

Passport Resorts LLC of San Francisco, which runs a 30-room hotel in Big Sur, Calif., and a small resort in Fiji, has purchased the Hana property for an undisclosed price from Meridian Financial Resources LLC. Although the hotel's 200 employees will be terminated as a formality, most are expected to be working after the new owner takes over Aug. 15.

Meridian, a Chicago-based investment group, acquired the Hotel Hana-Maui and the 4,500-acre Hana Ranch in 1999. The ranch was sold for $24 million in January to a group of investors led by the Ronald Getty Trust and Susan and Roy O'Connor, part-time Hana residents.

The sale to Passport Resorts includes the hotel, the Hana Ranch Store, Hana Ranch Restaurant and Hana Ranch Gas Station.

Richard Waring, operations manager for Meridian's Hana-Maui Land Co. LLC, would not comment yesterday on why the hotel and related properties were being sold. He said that occupancy has risen from about 20 percent when Meridian first took over to 50 percent for the first five months of 2001.

The company has invested about $2 million in renovations, most of it spent on the 47-unit Sea Ranch Cottages. Of the hotel's 93 units, only 67 are in use.

Passports Resorts would appear to be a good fit with the Hana property. The company owns the Post Ranch Inn in Big Sur and Jean-Michel Cousteau's Fiji Islands Resorts, which both cater to well-heeled visitors seeking solitude in a retreat-like setting.

Rooms at $455 to $835

Daily rates at the California property range from $455 to $835 for rooms that feature a massage table, indoor spa tub and no TV. At the Fiji resort, a former coconut plantation, rates for the 25 units are $425 to $655.

Current rates at the Hotel Hana-Maui are $235 to $655 per day.

Peter Heinemann, managing partner of Passport Resorts, said yesterday the company had been looking at the Hotel Hana-Maui for more than a year.

"Hana is one of the most incredibly beautiful places I've ever been to," said Heinemann, who has visited the area about a dozen times. "It's one of my favorite places."

The new owner plans "substantial renovations" that will be carried out in phases to allow the hotel to continue to operate without interruption, he said. Staffing needs are still being evaluated, he said.

The Hana hotel will be marketed to travelers looking for "a very different kind of Hawai'i experience, someone who wants to experience the old Hawai'i," Heinemann said. "There is really nothing like it anywhere else in the Islands."

Passport Resorts is not considering acquiring other Hawai'i properties at this time, he said.

Marketing exclusivity

Hotel industry consultant Joseph Toy of Hospitality Advisors in Ho-nolulu said the Hotel Hana-Maui's seclusion and low-key style was what attracted celebrities and other wealthy clientele in past decades.

"The Hotel Hana-Maui has always had a reputation as a very exclusive resort," he said. "It's difficult to get to and that was part of its charm back then."

But its isolation became a liability as luxury resorts sprouted along the Ka'anapali and Wailea coastlines, offering visitors exclusivity as well as close proximity to shopping, golf and other amenities, Toy said.

As occupancy at the Hotel Hana-Maui dwindled, past owners found it increasingly difficult to generate enough revenue from its relatively small number of rooms. Efforts to entice more guests by adding a golf course were doomed by strong community opposition.

Still, Toy believes there is a niche for small, high-end properties such as those operated by Passport Resorts.

Workers informed

Meridian officials met yesterday with employees to share word of the sale. The hotel is the largest employer in the community of 1,850.

Front desk clerk Tammy Helekahi, who has worked 16 years at the hotel, said most of the employees are taking the news in stride. "We've been through this a few times already, but you never know. Every owner is different," she said.

State Sen. J. Kalani English of Hana said yesterday that when it was announced earlier that the hotel was for sale, Meridian officials assured him it would be sold only to a buyer "conscious of Hana and its unique character."

"I hope they (Passport Resorts) know a part of the spirit of Hana is in the hotel," he said.

The hotel's history dates back to 1946, when San Francisco entrepreneur Paul Fagan established the six-room Ka'uiki Inn. Fagan also purchased Hana sugar plantation lands that he turned into the Hana Ranch.

Ka'uiki Inn, later known as the Hana Ranch Hotel, gradually expanded over the years, with extensive remodeling taking place in the 1980s.