Demolition work for the former Coco Palms resort on Kauai is on hold after a state land agency alleged developers conducted unauthorized work on the property.

Work to demolish dilapidated structures was slated to begin in May to make way for a new 350-room hotel, but a recent letter to RP21 Coco Palms LLC from the state Department of Land and Natural Resources alleging unauthorized work has delayed developers’ plans to tear down the buildings.

The land agency alleged the company cleared vegetation and trees on state land without authorization.

In the letter, Dawn Chang, chair of the state land agency, said the Office of Conservation and Coastal Lands received evidence that machinery has been used “to clear trees and vegetation, and to grub and grade” on a parcel within the state land use conservation district.

“Our office does not have any records of any permit being sought or secured for any land use on the subject parcel,” Chang said in the letter.

The land agency recommended developers to stop all work, claiming the work was “a potential land use violation” and that they may be subject to hefty fines.

In a statement, RP21 Coco Palms said there was no violation, as the company “takes its responsibility as a steward of these lands very seriously.”

Developers have since halted most activity at the site while they work with DLNR and the county to remedy the issue.

At a Kauai County Council meeting held in mid-May, Chang said the State Historic Preservation Division is also investigating the removal of dozens of coconut trees from the property. She noted the land agency did not give permission to remove the trees.

Developers declined to comment on the investigation.

Coco Palms has been closed since Hurricane Iniki battered Kauai in 1992, causing substantial damage to the property. Multiple attempts by previous developers to rebuild Coco Palms fell through.

The land has a rich history as it served as the home of Kauai’s last reigning queen, Deborah Kapule Kekaiha‘akulou.

Coco Palms opened in the early 1950s as a 24-room lodge. Honolulu hotel executive Lyle Guslander acquired the property in 1953. Under the vision of his wife, Grace Buscher Guslander, the lodge transformed into a resort of more than 400 rooms, suites and bungalows.

Frank Sinatra and Elvis Presley were among the celebrity guests who stayed at the resort. Coco Palms gained popularity after the 1961 movie “Blue Hawaii,” starring Presley, was filmed on the property.

During the mid-May County Council meeting, Chair Mel Rapozo said he planned to look into acquiring the land via eminent domain to preserve it for the public.

Rapozo could not be reached for comment.

RP21 Coco Palms said, “We are deeply committed to completing the development and restoration of this property while balancing the needs and concerns of the community.”

“If the Council decides that it is in the best interest of Kauai to buy the property, we respectfully hope that the Council will first show the community that it has the resources to pay fair market value for the property and to responsibly manage it, including the demolition of the structures and the maintenance (of) the property going forward,” the company said.

“The worst outcome would be to repeat the mistakes of past Coco Palms owners who have over-promised and under-delivered on their commitments to care for the property. We have the resources and the willpower to see this project through to completion,” RP21 Coco Palms said.