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Stalled Big Isle project might be revived

By Associated Press

LAST UPDATED: 1:56 a.m. HST, Aug 17, 2013

KAILUA-KONA » The creditor and debtors of the bankrupt Hoku­lia luxury development on Hawaii island have come up with a reorganization plan they say will revive the long-stalled development and ensure the county gets $20 million to complete the Mama­la­hoa bypass road.

A hearing on the plan is scheduled for Sept. 16 at U.S. Bankruptcy Court, West Hawaii Today reported Friday.

Phoenix-based developer Lyle Anderson had planned to develop Hoku­lia in three phases on more than two square miles in South Kona. It was to include about 730 residential lots, a 27-hole golf course and clubhouse, and other facilities. It was also to include a public bypass road that would run along the coastline from Napoo­poo to Kailua-Kona.

But the project ran into multiple major setbacks, leading to bankruptcy.

The creditor is investment firm Sun Kona Finance I LLC, which bought debt owned by Anderson's lender, the Bank of Scotland.

The debtors are 1250 Oceanside Partners, development company Pacific Star Co. and Front Nine. Together they have $68 million in assets but liabilities of $646 million.

"We have a restructuring plan and financing in place that, once approved by the court, will transform Hoku­lia," Craig Pickett, manager of debtor entities for Sun Kona Finance I, said in a statement.

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