A controversial commercial development on the famous black-sand beaches of Hawaii island has been stalled by foreclosure.
Black Sand Beach LLC had plans to develop Punalu‘u Village on 147 acres inland of Punaluu Bay in Kau, where endangered hawksbill and green sea turtles nest.
Several nonprofits, including the Center for Biological Diversity, announced the foreclosure Monday after battling the “sprawling luxury development” for more than a year. A Hawaii circuit court, the center said, had approved the order against Black Sand Beach LLC after it defaulted on a $3.4 million mortgage.
That means the 147 acres is now headed for public auction, according to Maxx Phillips, the center’s staff attorney.
“This foreclosure is a much-needed reprieve for Punaluu and the people of Kau,” said Phillips in a statement. “This place is sacred. It holds deep cultural meaning, irreplaceable ecosystems and fragile species found nowhere else on Earth. It was never appropriate for large-scale development. The people of Kau have spoken loudly and clearly — they want this place protected, not paved. We’re proud to stand with the community to help make that vision a reality.”
The developer had sought a special management area permit to build some 225 residential and vacation rental units at the site, along with a wellness center, retail shops and rehabilitation of golf courses, with about 30 acres dedicated to conservation.
Black Sand Beach had earlier acquired a total 434 acres, including the parcel — formerly the Sea Mountain at Punaluu — slated for the Punaluu Villages project.
In October 2023, Hawaii County’s Planning Department Director Zendo Kern had conditionally approved an SMA minor permit for a farmers market and firebreak roads.
But community opposition was strong, as shown by hundreds of Kau residents over two days of testimony at a public hearing held in March 2024, according to Guy Enriques of Malama Pono Punalu‘u.
The Windward Planning Commission held the public hearing on March 7, 2024, in Hilo; it went on for a second day due to the volume of testimony.
The legal standard for approving an SMA permit includes whether the development is consistent with the objectives, policies and guidelines of the federal Coastal Zone Management Act.
The center said an updated environmental impact statement was warranted to address the deteriorating wastewater system and its threat to coastal water quality.
The proposed project is also in an area where endangered turtles feed and nest, it said, as well as home to anchialine ponds, limu beds, freshwater springs and numerous Hawaiian cultural sites, including iwi kupuna and heiau.
In May the commission granted the Center for Biological Diversity, Native Hawaiian Legal Corp. and nonprofit community group ‘Iewe Hanau o ka Aina standing to intervene in a contested case hearing.
Hawaii County, however, never moved forward with the hearing, according to the center, and then Black Sand Beach defaulted on its mortgage, ”effectively ending the permitting process for Black Sand Beach, LLC,” the center said.
Community groups celebrated the news as a victory — for now.
“It’s definitely a sigh of relief,” said Nohea Ka‘awa of ‘Iewe Hanau. “This battle has gone on from developer to developer. This has got to be the third or fourth proposal.”
Ka‘awa said Punaluu is a tightknit community that comes together as a family to protect the land, and that her group’s hope “is that we can steward this land.”
There have been sign- waving rallies over this development, she said, as well as a huge response to an online petition opposing the resort.
At last check the petition had been signed by more than 18,500 supporters.
“For me it’s very personal,” she said, noting that generations of her kupuna are buried at Punaluu. “It’s all about access, about reciprocity and about the relationship we have to our land when your kupuna or ancestors are buried in that land.”
She said her nonprofit hopes to give Punaluu the protection it needs forever “so we don’t have to face this anymore.”
“What we want here in Kau is to continue to have access to the places that grow who we are physically and spiritually,” she said. “Aina, just like our kupuna, sustains us and gives us life. It is our kuleana to maintain a reciprocal relationship with our environment for our survival. We come hard in the fight to protect Kau, and we will continue to do so so that our keiki and generations to come can live simple and free of threats to our way of life.”
Enriques said the development went against the values of the Kau Community Development Plan, putting a place that the residents loved and cherished in jeopardy.
The groups also raised concerns over public access to the beach, and cultural and archaeological sites.
“This is a victory rooted in the voices of community members and cultural practitioners who showed up, time and again, to speak for the land and waters of Punalu‘u,” said Ashley Obrey, staff attorney at the Native Hawaiian Legal Corp., in a statement. “While this foreclosure halts the current project, we remain vigilant. This land deserves a future shaped by community vision, grounded in malama aina, and conforming to the environmental and cultural practice protections Hawaii law requires.”
According to state business records, Black Sand Beach LLC was formed in April 2020 as a real estate development company. The manager is listed as Xiaoyuan Liu, and the trade name Punaluu Village has been registered through July 2027.
Black Sand Beach LLC could not immediately be reached for comment.
In an advertisement published in the Hawaii Tribune-Herald, Black Sand Beach LLC said the project would bring jobs to the area, offering a list of people supporting it.
Black Sand also said it had downsized the project considerably — to 225 from 2,900 units — and committed to move all commercial activities off the shoreline to protect Native Hawaiian gathering and fishing rights, set back the shoreline at least 1,100 feet and create a community-led foundation to steward conservation areas and sacred sites.
A website, punaluublacksandbeach.com, was established, with a message that says, “Coming soon.”
