Outrigger Enterprises Group, Hawaii’s largest locally owned hospitality chain, is selling its assets at the Ala Moana Hotel.

The chain began managing condotel operations at Ala Moana Hotel in 2005 for Miami-based condominium development firm Crescent Heights. Barry Wallace, Outrigger’s executive vice president of hospitality services, said the company bought the front desk, which runs the reservation system, and some other commercial assets from Crescent Heights in 2007. About 1,100 of the individually owned condotel units at the 1,200-unit property are in Outrigger’s hotel pool.

Wallace said the company remains interested in managing the property, but decided to sell its ownership stake because it wants to invest more heavily in its beachfront properties in Hawaii and throughout the Pacific Rim.

“We want to focus our investment on becoming the leader of island beachfront properties,” Wallace said. “We’re trying to take advantage of the strong hotel market to make that happen.”

Joe Toy, president and CEO of Hospitality Advisors LLC, said Outrigger’s stance makes sense given that beachfront properties tend to lead hotel pricing.

“In a downturn, the beachfront can discount to the tier below them. The lower tiers will be bound by what they do,” Toy said.

Wallace said Outrigger has retained a broker and informed its 200 or so Ala Moana employees on Wednesday of the pending listing.

“We’d be delighted to stay and manage the property, but the buyer may have other ideas. Regardless, it’s been a very successful operation so we don’t think there will be an impact on employees,” he said. “We would imagine that any buyer would continue in a similar manner.”

Erik Kloninger, a principal with Kloninger & Sims Consulting, said he expects the strength of Oahu’s hotel market as well as the scarcity of product will net strong buyer interest in the Ala Moana Hotel. Prospective buyers also may be drawn to a model where condominium owners are responsible for room renovations and some other capital investments, he said.

“It’s the chance to own a hotel without all of the burdens,” Kloninger said. “It’s a very popular model — look at Trump, the Ritz-Carlton towers and King’s Village.”

He said condotel unit purchasers typically employ off-site or on-site management companies to rent out their rooms. Fees may be as much as 50 percent of room revenue for their services.

While the new owner could face competition from the vacation rental sector, Kloninger said it bodes well that the Ala Moana Hotel’s rental pool has managed to retain a very high percentage of units.