A partially completed luxury home subdivision on Hawaii island is headed back to the foreclosure auction block after a failed gambit by the developer to retain a stake in the $100 million project through bankruptcy.

The project called Ke Kailani and created by former HBO Chief Executive Michael Fuchs is scheduled for a June 21 auction.

Ke Kailani was to be auctioned in early January, but Fuchs placed the project in bankruptcy in a bid to arrange a sale that was more favorable to the media mogul-turned-developer, who said he has lost more than $35 million of his own money on the proj­ect.

A sale to someone other than the mortgage holder pushing foreclosure could take place at or before the auction if a buyer is willing to pay more than the roughly $22 million Fuchs owes on the property’s mortgage.

Up for auction are 25 single-family home lots, land planned for eight condominium units and two completed condo units.

Fourteen single-family home lots and two condos previously sold by Fuchs’ development firm in the 51-unit subdivision are not involved in the foreclosure.

Ke Kailani has been in the works for nearly a decade. Fuchs bought 65 acres of land fronting three golf fairways at Mauna Lani Resort for $15.5 million in 2002 with an eye to building a home for himself. As a way to offset the hefty cost of the land and infrastructure, he planned to develop 12 condominiums and 39 house lots for sale.

Fuchs, with the assistance of local development consultant Will Beaton, produced an ultrahigh-end project that included condo kitchens designed by Hawaii celebrity chef Alan Wong; a community clubhouse with a saltwater pool overlooking the ocean; and a 5.5-acre inland park with a freshwater pond, pools, a hula mound, jogging trail and courts for basketball, tennis and sand volleyball.

Sales, however, faltered with the economic recession after a strong early start that included selling one oceanfront lot for $8.5 million in 2005 and two condos that went for nearly $4 million each in 2007.

In all, Fuchs was able to sell 14 lots and two condos for a combined $38 million, according to property rec­ords. But project development loans went into default in 2008 after sales stalled.

Lenders Bank of Hawaii, Central Pacific Bank and Finance Factors Ltd. initiated foreclosure in October 2009, claiming that $52 million in loans made to Fuchs had an unpaid and overdue balance of $22 million.

An affiliate of Texas-based development firm Hunt Cos. later acquired the mortgage from the lenders and pushed ahead with foreclosure.

A day before a slated auction in January, Fuchs placed the project in bankruptcy. That stopped the foreclosure.

Fuchs filed a bankruptcy reorganization plan about a month ago that said a Colo­rado-based firm, Resource Management Interests LLC, planned to invest $42 million in Ke Kailani to fully pay off creditors, fund development and leave Fuchs with a 5 percent stake.

Fuchs and Resource Management anticipated finishing the proj­ect over four years and selling remaining lots and condos for $157 million and returning $33 million to the new lender and $12 million to the developer.

However, bankruptcy rules gave Fuchs limited time to implement the reorganization plan, and that timetable couldn’t be met. So last week a bankruptcy judge allowed the foreclosure to resume, and the bankruptcy case was dismissed Thursday.

Gary Dubin, a local attorney representing Fuchs, said a variety of options is available, including working out something with Hunt, arranging a private sale ahead of auction or seeing whether competitive bids are made at auction.

"Nothing is being precluded," Dubin said. "We hope to have a happy ending to this whole thing from Fuchs’ point of view. He’s not walking away and giving up."