Post-Hurricane Kauai Still Not 100% Open For Business
<H1> Post-Hurricane Kauai Still Not 100% Open For Business</H1>By Maria Lenhart
<B>I</B>t's been more than three years since Hurricane Iniki swept through Kauai, but repairs have yet to start on several major resort hotels, including the Stouffer Waiohai Beach Resort, Stouffer Poipu Beach Resort and Coco Palms Resort.
On the brighter side, three of Kauai's most deluxe resort hotels have reopened since the hurricane, and work is expected to begin on the Sheraton Kauai Beach Hotel in June.
Coco Palms, one of Hawaii's oldest resorts and known for its lush grounds used for scenes in the Elvis Presley film "Blue Hawaii," remains closed as owner Wailua Associates and insurance company Aetna battle over coverage and damage costs, estimated to be anywhere from $20 million to $55 million. Once the dispute is settled, the permit and construction process could take as long as three years to complete.
The reopening of the Stouffer properties is equally uncertain. CTF Investment, the Hong Kong-based owner of the two hotels, is reviewing architectural and engineering plans for them, but no decisions have yet been made, according to Carol Furtado, acting general manager for both hotels. One option being considered is turning part of the resorts into timeshare condominiums.
Sheraton, however, has announced plans to begin repair work later this year on its two neighboring hotels at the Poipu Resort complex on southern Kauai, the 160-room Sheraton Kauai Garden Hotel and the 213-room Sheraton Kauai Beach Resort. When work is completed in late 1997, the two properties, which are located across the street from one another, will be merged into one and renamed the Sheraton Kauai Beach Hotel.
Holding up the Sheraton project was a dispute between owner Obayashi Hawaii Corp. and lease owner Knudsen Trust. The Kauai Beach Resort's 94-room beachfront wing had sustained the most damage from the hurricane, and plans call for a new wing that will double the amount of rooms to 500, including many more with ocean views, said Kieth Viera, vice president of marketing for ITT Sheraton Hotels in Hawaii. Another change is that the lobby and other public areas will be on the beachfront side.
Among those eagerly anticipating the reopening of the Sheraton is Margy Parker, executive director of the Poipu Resort Association. "The continued closure of the Stouffer Waiohai, the Poipu Beach and the Sheraton Kauai hotels is playing havoc with Kauai's hope of an economic recovery," she said.
Equally anxious to see hotels back in business is Kauai mayor Maryanne Kusaka, who plans to introduce a bill requiring hotels on the island to reopen within a certain period of time following a disaster or risk losing their zoning rights.
Among the deluxe resorts that have reopened are the former Westin Kauai, which came back last June as the Kauai Marriott Resort & Beach Club after a $36 million repair job. The Hyatt Regency Kauai and Sheraton's Princeville Hotel have been open since 1994.
There has been some speculation that insurance disputes are not the only reason some hotels remain closed, and that their owners could be waiting for Kauai's business climate to improve. According to PKF Hawaii, a firm that tracks hotel trends, Kauai hotel occupancy rates fell 10 points last year from their 1994 levels of 75 percent.
"Occupancies stayed relatively high during 1994; the demand was there as properties such as the Hyatt Regency Kauai reopened," said Erik Kloninger, manager of PKF Hawaii. "But in 1995 when the Kauai Marriott reopened, the demand was not keeping pace with supply."
However, Kloninger believes the reopening of major resorts will be a benefit to Kauai in the long run. "A resort like Marriott adds a lot of marketing clout for Kauai," he said.