One thing you can definitely say about Coco Palms is that it remains at the forefront of Kauai news and people’s minds. This week the saga continued with an odd foreclosure sale.
Coco Palms Sold on July 26.
A scheduled foreclosure auction took place at the Fifth Circuit Courthouse near Lihue Airport. Alas, there was only one bid, and there is 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 is also an upcoming confirmation hearing at which other bids, were they to materialize, could be heard.
There is no place for a new Coco Palms Resort. So what about a park?
The county is moving in the direction of wanting the former resort to become a park.
Coco Palms would no longer be viable as a hotel for a myriad of reasons, as you’ll read below. Among them, the property is located on what has 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.”
We reached out to Felicia for this article, and she replied that she does not 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 resort ever.
Kauai Coco Palms Resort never ceases to amaze us with its enduring popularity. Nor does the fact that it remains an unexpectedly awful eyesore and safety hazard on the island after being largely destroyed nearly three decades ago during Hurricane Iniki.
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 some 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.
Earlier this month, we reported that several publications had indicated Coco Palms was set to be demolished. However, we were never unable to verify that, and the county indicated it was not aware of a demolition permit 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 the steel rebar within the buildings’ concrete corroded and failed as a result 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 started on the upper floors, then expanded to affect the entire infrastructure.
More reasons why 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 pre-existing 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 hurricane, 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.
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 the rightful owners. Developers said, “The county recognizes us as the owner of the property.” That was affirmed by the court in 2018.
4. The land is considered ancient Hawaiian royal property, and disputes have been ongoing since the 1800s.
We welcome your comments.