Renovation work on the main Y-shaped tower of Waikiki's iconic Ilikai hotel is slated to begin in the next few months as the 43-year-old property undergoes its biggest transformation in history.

Under a proposed $60 million upgrade, additions are to include a rooftop pool and deck with cabanas on one wing, a reflecting pool with cabanas in the lobby courtyard, and a spa and new second-floor pool.

Tennis courts would make way for another new pool, renovations to the porte cochere would include seating for a new cafe, and glass lanai railings with a turquoise tinge would replace old turquoise panels.

Also, 343 units in the roughly 1,000-unit tower that have long been owned in bulk for hotel use are being sold individually to investors, most of whom are expected to continue renting out the units for hotel use.

Prices for units, most of which occupy the top four floors of the 30-story tower, range from about $400,000 for 500-square-foot studios with kitchens to $4 million for roughly 2,000-square-foot suites.

The envisioned changes are part of a plan by local developer Brian Anderson to transform the Ilikai, which has had two major but less extensive renovations in the last two decades, into an upscale high-rise hotel fronting the Ala Wai Boat Harbor.

"I think it's going to be a product completely different for Waikiki," Anderson said.

The Ilikai was developed in 1964 as part residential condo, part hotel by local businessman Chinn Ho.

Anderson's Anekona Development Group last July bought 343 units along with commercial areas of the tower plus a connected Ilikai building called the Yacht Harbor Tower with 360 hotel rooms for $218 million.

Not included in the purchase were roughly 575 individually owned condos and 80 time-share units in the main tower.

TOWER RESOLD

As part of the deal, Anderson resold the Yacht Harbor Tower, which includes meeting rooms, the main pool and commercial space, to an affiliate of San Diego-based real estate firm eRealty Cos., which closed the hotel but has not publicly disclosed its plans.

For the main Ilikai tower, Anderson since his purchase has been devising conceptual renovation plans, and recently began presenting some details to other unit owners in the building.

Anderson said he plans to begin renovating rooms next month, and hopes to begin upgrading common areas and the building's exterior in June, though he needs 75 percent of unit owners, including his company, to approve common area and exterior changes.

Ilikai unit owners and Anderson have had somewhat of an adversarial relationship because of initial changes that included the loss of the Ilikai's main pool, an 'ewa entrance, parking and storage facilities.

But the developer believes recent presentations of his improvement plan have erased much of the uncertainty and mistrust some owners had, and that his plan will be approved.

"We've had a lot of positive response in the last few weeks," said Anekona project manager Adam Wong.

Max Watson, owner of four Ilikai units since 1986, said he was upset by initial changes Anderson made to the property, but he doesn't oppose the renovation plan that's been presented.

"He initially came in here like a bull and made people mad," Watson said of Anderson. "If he does what he says he's going to do, it might be a plus for us."

Anderson said he is paying for all the improvements in his plan, and that the building's existing maintenance reserve fund in essence will be saved from making future upgrades to things covered in his plan, such as new carpet, wall coverings and lighting in the hallways, lanai railings, and lobby and pool furniture.

Maintenance fees should not be affected by the improvement plan, he added.

UPGRADE PACKAGE

Another offer Anderson is making to other unit owners is to allow them to rent their units through the resident hotel management company if owners buy the same room upgrade package Anderson is using for his units. Previously, independent unit owners didn't have such an option.

Anderson anticipates that if renovation work progresses smoothly, it should be completed in summer 2008.

The developer plans to retain management of the hotel but operate the Ilikai under a licensed brand-name that is still being negotiated. Previously the Ilikai was operated under Marriott's Renaissance flag.

Ilikai unit sales are being done in two phases. Last September, Anderson made 167 units available to people who invested in prior Anekona real estate projects. Of those units, 54 sales have closed and 36 are in escrow, Anderson said.

Another 162 units on the Ilikai's top four floors will be released for sale in May, while 14 units are being absorbed for other uses including a lounge and fitness center.

Anderson said he has concentrated marketing efforts in Japan and Korea where he expects 80 percent of Ilikai buyers will originate. "We believe that's the wave of the future," he said.

Reach Andrew Gomes at agomes@honoluluadvertiser.com.