Kauai mayor bemoans collapse of Coco Palms effort

Like many Kauai residents, Mayor Derek Kawakami is not surprised that the latest plan to rebuild the long-shuttered Coco Palms Resort fell through.

“It just seemed every step of the way, there were assurances made that were never fulfilled,” Kawakami said Wednesday. “Once again, the people of Kauai are going to be faced with having to deal with this blight that has been in existence since Hurricane Iniki.”

Tyler Greene, one of the investment partners of Coco Palms Hui LLC, recently announced they are putting the resort on the market. He cited millions in additional project costs caused by delays after developers faced opposition from Native Hawaiians who claimed ownership of the land.

A court complaint filed by opponents was dismissed in June 2018 and an appeal was dismissed five months later.

Stillwater Equity Partners, a Utah-based development and asset manage- ment firm that was appointed by the lender Private Capital Group to manage Coco Palms Hui, said it is seeking a new buyer after Coco Palms Hui defaulted on a loan in 2017 . Stillwater said the group also failed to formalize a plan or financing commitments by the end of 2018.

The equity firm sought the assistance of Colliers International to market the project to potential buyers. If a buyer is not found in the coming months, Stillwater will explore other alternatives that would benefit the community.

In the meantime, the firm is working with crews to improve the appearance of the site for potential investors, said Stillwater asset management director Aaron Gerszweski in an emailed statement.

Kawakami said many isle residents were unfazed by the announcement of Coco Palms being back on the market.

“Most people are pretty acclimated that this property has been sitting like this for awhile,” he said.

Since Coco Palms shut its doors over 25 years ago, after Hurricane Iniki slammed into Kauai and caused extensive damage to the property, several different developers have unsuccessfully attempted to rebuild the resort.

“It’s still an eyesore,” Kawakami said, adding traffic at the corridor is also a problem and the property is in a tsunami inundation zone.

The county does not have the resources to acquire the property, but Kawakami said his administration supports a collaborative partnership between other entities to bring some kind of closure with the property.

“We, as a county, definitely are ready to sit down at the table and bring people together to have a discussion on what the next episode and next chapter of the saga of the Coco Palms are going to look like.”