Infamous Coco Palms Kauai | Why It Just Won’t End

One thing you can definitely say about Coco Palms is that it forever remains at the forefront of Kauai news and people’s minds. With nearly 400 comments about the resort, your feelings are clear.

When we wrote about it nearly a year ago, the saga continued with an odd foreclosure sale. Since then, your editors have frequently drive by the once luxury resort (see video below), and it never ceases to amaze us. It sits there, an ugly old decaying concrete shell. Truly an eyesore.

There are no signs of demolition and to our understanding there are no demolition permits. Instead, building permits from years ago are still pending and those are found below.

Coco Palms was sold again last year.

A scheduled foreclosure auction took place at the Fifth Circuit Courthouse near Lihue Airport in July 2021. Alas, there was only one bid, and there’s a new owner, sort of, at least for now. The property was sold in “as-is” condition.

One commenter on Facebook said what many of us were thinking, “I was dreaming that one notorious billionaire from the north shore would buy it, tear down all the man-made structures and donate it for a cultural park and parking for Wailua beach.” (Margaret Goode).

Neal McManus added, “It seems that a team of multimillionaires and certain billionaires that enjoy the island could “pitch-in” and have the parcel restored, made into a multi-use Hawaiian cultural space/center for the Kauai community. The resultant development could be endowed in the same manner and intent that Duncan McBryde did with Kukuiolono with the county of Kauai.”

In the end, however, the company Private Capital Group, paid $22 million for the land. The bid was actually a credit for the original principal value of a loan obtained by the prior developer. The new buyer was the lender for the previous owners who defaulted on their debt during the last of a string of failed efforts to rebuild the hotel. That plan, which would have turned Coco Palms into a 350-room resort, began in 2015 and then changed hands again in 2019 through a massive mortgage default.

Being the new owner in title, Private Capital Group can now move forward to try to sell it yet again. No one knows exactly what their next move will be.

There’s no place for a new Coco Palms Resort. So what about a park?

The county was moving in the direction of wanting the former resort to become a park. But even that seems to have gone quiet.

Coco Palms wouldn’t be viable any longer as a hotel, for a myriad of reasons, as you’ll read below. Among them, the property is located on what’s become a very noisy stretch of Kuhio Highway, with no beach access. In recent years, many hotels have been built that, while not Coco Palms, offer beachfront locations at prices that undermine any potential for profitability.

The idea of a park has been floated for many years. BOH editors’ friend and Kauai Council Member Felicia Cowden asked that Coco Palms be “set aside for a future community wilderness or cultural park. Those prime, historically significant lands should not be attached to the problematic private pieces to help move a distressed asset.”

When we last reached out to Felicia about this, she replied that she doesn’t believe that the County has the financial resources to acquire the property. “Hopefully, the county will consider it; however, I don’t think we can afford it. A best-case would be a friendly buyer, and that is where I will focus my efforts.”

Ultra-popular Coco Palms of the past. Still Kauai’s most iconic and most infamous resort ever.

Kauai Coco Palms Resort’s enduring popularity is unending. The unexpectedly awful eyesore and safety hazard on the island after being largely destroyed nearly three decades ago during Hurricane Iniki, continues.

This was where the rich and famous once stayed, and Elvis Presley’s Blue Hawaii was filmed. The property consists of 20 acres fronting the highway at Wailua Beach, combined with 15 acres of state-leased land.

This post-series has now been read more than a quarter-million times, which is a good indication of your love of and fascination with Coco Palms. We, too, enjoy reading your hundreds of fascinating comments depicting fond memories of Coco Palms and ongoing dreams for its future.

Demolition rumors.

We continue to anticipate, as we reported last year, that Coco Palms will eventually be demolished. However, we were never able able to verify rumors that it was inevitable last year. When we checked, the county wasn’t aware of demolition permits being issued.

All essential concrete structures failed.

The original building core was to be an integral part of future development. That, however, became impossible when steel rebar within the buildings’ concrete corroded and failed because of exposure to ocean salt and moisture. The corroding steel cracked the concrete and spall due to the swelling and increased tensile load on the steel. That issue began on the upper floors, then expanded to affect the entire infrastructure.

More reasons Coco Palms can never be a hotel again.

Kauai’s prior mayor JoAnn Yukimura, said development permits “should have never been issued.” She bemoaned that Kauai has too many hotels as it already stands. “Removing the cloud of resort development from the property will enable the community to come together around a new vision for that site — a vision that could include a park and culture center that interprets the history of the place.”

Another BOH editors’ friend Allan Parachini, jokingly wrote on his Facebook page during Covid about Coco Palms Resort: “I am so happy to hear today that Kauai County has officially designated a Quarantine Hotel for the duration of the COVID-19 pandemic…As you can see, all of the accommodations have plenty of fresh air.” As we said, “Elvis has left the building.”

Coco Palms current condition.

The last round of attempts disintegrated with multiple developers unable to make it work—all to the chagrin of visitors, locals, and the Kauai County government.

When driving by, you see enormous amounts of ugly, original concrete and steel, as in the image below. The developers had planned to use these preexisting steel, and concrete structures as the base of the new resort before those plans were terminated by nature and finances. The iconic lagoon was also set to be restored, as is shown in the image depiction above.

Beat of Hawaii: Coco Palms sits largely unchanged, destroyed through hurricanes, fraud, neglect, and to this day, ongoing controversy for over a quarter-century.

In 2016, a multi-million dollar selective-demolition project was completed. This included drywall and asbestos removal, electrical and mechanical repairs, renovations at the Lotus Restaurant, and bungalow building. It pretty much was stripped clean. And it has sat virtually untouched since then.

Status of building permits.

There are fourteen pages of building permits in various stages for Coco Palms Resort that can be found here. Search by name and enter Coco Palms.

Could Zuckerberg still play a role?

Turned into a historic park or something similar via a gift to the county or otherwise, this could be a way for the island’s wealthiest to make a very favorable impact. Kauai is Zuckerberg’s island home. Who else might help out?

Another commentor about the sale offered this, “Sounds good. Too risky to do anything, lender playing money games, price is low enough for the state to buy it. Great work!” (Robert Gluckson)

Did you know these Coco Palms’ details?

1. A once planned connection to the Koa Kea Resort was dropped. The last developer was rumored to have been in discussions with the Meritage Collection about running the Coco Palms in addition to Koa Kea.

2. Reopening as a Hyatt property was also aborted. In 2014, the plan was for Coco Palms to reopen in 2020 with 273 rooms, 77 suites, 3 restaurants, a cultural center, 12k square feet of retail, and more. It was then to be part of the Hyatt Unbound Collection.

3. In 2017, a dispute arose when a group of Native Hawaiians claiming to be descendants of Kauai’s King Kaumuali’i began living on the property. A judge refused to remove them from Coco Palms while determining their rightful owners. Developers said, “The county recognizes us as the owner of the property.” The court affirmed that in 2018.

4. The land is considered ancient Hawaiian royal property, and disputes have been ongoing since the 1800s.

See our recent drive-by video.

We welcome your comments.

Updated 4/21/22