Maui Hotels Make Big Investments To Court Corporates

<B>Maui Hotels Make Big Investments To Court Corporates</B>

By Judy Jacobs

From Wailea and Kaanapali to the northern shores of Kapalua, Hawaiian properties are spending millions on renovations and new facilities to snare more corporate meeting and incentive business.

Two hotels in Wailea,the Grand Wailea Resort and the Outrigger Wailea, are under new ownership and in the midst of upgrades that will allow them both to pursue the meeting and incentive market more effectively than in the recent past. "The Grand Wailea originally opened with a big bang when Hyatt came in, but lost it with the previous owner," said Jamie Bruce, the hotel's director of sales and marketing. "When we got here, there was a sales staff of two. The new owner took over in December 1998 and added six group sales managers, and we've gotten very aggressive in all the markets--insurance, incentives and associations. We hired an executive meeting manager last year to concentrate on groups of 100 rooms or less."

The new owners also have spent $11 million on renovating the 780 guest rooms, upgrading the meeting rooms and exterior and have committed $6 million per year for continuing the work. Late last year, the hotel's former luau garden was converted into a 10,000-sq.-ft. oceanside outdoor function space, which includes a stage and accommodates 1,000 people.

The Grand Wailea's efforts should pay off, since nearly half its business comes from the meeting and incentive market. "Group business is 45 percent of the hotel's total business," Bruce said. "Eighty percent of our group business is incentives, and the other 20 percent is association meetings, annual meetings and continuing professional education." Its 52,000 square feet of indoor meeting space includes a 28,000-sq.-ft. ballroom.

Meanwhile, Outrigger Hotels & Resorts purchased what was the Aston Wailea in the fall of 1998 and renamed it Outrigger Wailea Resort. Along with the new ownership came a massive renovation and an effort to penetrate new markets. "We hadn't had the product for the incentive market in the past, but we are now planning to increase our share of incentives," said Kathy Dziedzic, director of sales. "We're working back to a four-diamond level."

The 466-room hotel is in the midst of a $25 million renovation that will make it a virtually new property. The hotel's former entrance way was removed and turned into a 32,000-sq.-ft. park with seven banyan trees and a stream with carp. The guest rooms, scheduled to be completed by year-end, are being gutted and redecorated. High-speed Internet access also is being added. The Outrigger's meeting facilities total 45,000 square feet, including a 13,800-sq.-ft. ballroom. The conference pavilion will be renovated next year.

Also at Wailea, the Kea Lani, a 413-suite independent property unassociated with a chain, added six rooms to its spa last November and has opened its first mainland group sales office in Walnut Creek, Calif., promoting its former West Coast sales manager Lesli Farry to head that office as group sales manager.

The move is the latest step in the Kea Lani's efforts to attract meetings and incentives.

"We started group sales four years ago, and since then it has gone from 10 percent to 25 percent of the hotel's overall business," Farry said.

One of the resort's primary appeals is the fact that its accommodations include 37 two- and three-bedroom villas. The hotel has 15,360 square feet of meeting space. The typical corporate meeting size is 40 to 50 people, and the average incentive ranges from 75 to 100 people, Farry added.

While individual hotels are making improvements to attract their own meetings and incentives, collectively the seven resorts at Wailea--Grand Wailea Resort, Four Seasons, Kea Lani, Renaissance Wailea beach Resort, Outrigger Wailea and Destination Resorts Hawaii--along with the Wailea Golf and Tennis Clubs have created an alliance to attract meeting and incentive groups that would be too large for the individual properties to handle on their own. Known as Wailea Wide, it gives planners the option of bringing groups of 1,000 or more rooms to the planned resort and allows Wailea to compete more effectively with Oahu, the Big Island and Kaanapali for the bigger groups.

"There aren't many places in Hawaii that can handle big groups," said Grand Wailea's Bruce. "We will be the host property and handle as much of the group as possible. The other hotels will also handle rooms as well as functions." Wailea Wide intends to target large incentives and corporate meetings, as well as associations.

Meanwhile, at Kaanapali, the Westin and the Marriott also are upgrading as they continue to compete for their share of the high-end incentive and corporate meeting market. "The Westin had been a leisure hotel that was doing some groups," said Michael Lee, the Westin Maui's director of sales. "Previously, groups were about 18 percent, but we want to increase that number to 28 percent, including more incentives and corporate meetings." The 756-room hotel plans to do this by upgrading its guest rooms and creating new meeting facilities.

The hotel will conduct a $16.2 million total refurbishment of all of its guest rooms between Sept. 6 and mid-December. It will install new soft goods, as well as Westin's signature Heavenly Beds. The Westin also increased its meeting facilities by 45 percent to a total of 45,000 square feet, when it converted a former restaurant into a 14,000-sq.-ft. function room that opened late last year.

Just down the beach, the Maui Marriott is in the midst of a $70 million top-to-bottom renovation that includes a total room renovation and an upgrade of the ballroom. In addition, the redesigned resort will include a $7 million dollar swimming pool system with waterfalls, a water slide and a sandy beach, a facility that its neighbors the Hyatt and Westin already had. The renovation will put the Maui Marriott in a new league.

"We're switching our market segmentation from moderate corporate to high-end incentives," said Paul Chicoine, who is Marriott's area director of market sales. "In the past, we attracted corporations that needed a value rate. Now, however, our competitive set is changing."

On the northwestern tip of Maui, the Kapalua Bay is another hotel hoping to capture more of the meeting and incentive market after an upgrade and expansion of its facilities. Starwood took over management of the 206-room resort in February 1999, and added it to its Luxury Collection. "We redid the lobby and added meeting space, because we could only do one group at a time with a 3,000-sq.-ft. ballroom and two boardrooms," said Kelly Hoen, the hotel's general manager.

The hotel added 3,000 square feet of meeting space in the form of a deluxe boardroom, which seats 12, and three other meeting rooms, each accommodating up to 80 people.

"The average group size is 60 people or 30 rooms," Hoen added, "and now we can do multiple groups--as many as three groups at a time. Our intention is to grow the meeting and incentive business from what it was last year--17 percent--to 25 percent of our total. With the relaunch of the hotel into the Luxury Collection, we're getting back on the incentive track. We plan to continue to add services and enhance our spa services to cater to the high-end market.