South Maui LGBT resort sold and renamed

The Maui Sunseeker, the north Kihei shoreline resort known for catering to the LGBT community, has a new owner and a new name.

On Sept. 2, the sale of the 26-room resort by Chuck Spence to M R and T Maui Hotel Management, led by Dhaval H. Panchal of San Jose, Calif., was completed. With the sale, the hotel’s name was changed to the Kohea Kai Resort Maui, which means “calm winds or serenity by the sea,” Panchal said last week.

The Sunseeker, which appeared on the Travel Channel’s “Hotel Impossible” and had been named the island’s top boutique hotel by TripAdvisor guests, had carved out a niche catering to the LGBT community. In June, a vigil was held on the shoreline fronting the resort for victims of a shooting at a gay nightclub in Orlando, Fla.

In 2012, when Hawaii became one of the first states to allow civil unions, the Sunseeker helped arrange 86 civil unions – 7 percent of the total civil unions in Hawaii that year, Spence said.

The increasing acceptance of the LGBT community and the establishment of the constitutional right for gay people to marry in the years since Spence bought the Sunseeker in August 2008 have been good for the LGBT community but generated “an evolution in the market,” he said. Now, it is easier for couples to get married in their own communities rather than flying to Hawaii, Spence said, noting that the resort didn’t arrange as many marriages, compared to the civil union days.

“It is a very positive thing that society has accepted the LGBT community and understood the discrimination issues against them,” said Spence, who his gay.

Amid the winds of change, the Kohea Kai will not be an exclusive LGBT resort but will welcome everyone regardless of sexual orientation, said Panchal. It also will be an adults-only resort, which may add a comfort level to returning guests.

“This hotel is open to anyone,” he said. “We are going to be targeting everyone.

“We are going to be welcoming everyone with welcoming arms. We don’t want to lose any business from any demographic.”

Spence has been emailing and communicating with thousands of his loyal clientele to vouch for the new owners and to encourage them to return. His email and Facebook friends lists total more than 8,000 clients.

Current bookings are being honored by the new owners and refunds will be offered to those who want to cancel. Both Spence and Panchal said that “almost everyone” is accepting of the change. Spence cited the “ohana” atmosphere, the service (most of the staff is staying on, including longtime General Manager Michael Waddell) and the providing of “a Maui home for people” as the main reasons guests return.

When he took over the resort in 2008, Spence said that the Sunseeker already had a very strong gay male guest rate. He expanded the clientele base by marketing to gay women and later adding an LGBT focus.

“I just accentuated it more when I took over,” he explained.

But now, the market may be at a point where the group of “progressives want to socialize with other progressive people,” Spence said.

The Sunseeker clientele was “very reliable and faithful,” he said. The resort had a 40 percent repeat visitor ratio, the envy of other hoteliers that would be happy with half that percentage, he indicated.

It was “time to slow down a little . . . and enjoy life a little bit,” Spence said in explaining why he put the resort on the market in January.

“I have been working since I was 10 years old, and I am 60,” he said. “The time was right to put it on the market.”

There were several prospective buyers in February, and Panchal and his company “seemed to be the best fit for us,” Spence said. Panchal’s company would hang on to the clientele and create an environment where current workers could transfer to the new company, he said.

“Because I have such an affinity for the property and the guests we have taken care of over the years,” it was important to “find the right buyer,” he said in requesting face-to-face meetings with all prospective buyers.

Panchal and his father, Hareshkumar, the founder of the family company, flew to Maui to look at the resort and meet with Spence. Panchal and his family have been frequent visitors to Maui.

“I love this place,” he said.

“It is luck. I feel blessed,” said Panchal about being selected by Spence. “I was the lucky one out of all the offers. I was happy about that.”

Panchal’s company manages 60 full-time and 10 part-time workers in now eight hotels, most in the Bay Area. They include the Hampton Inn and Suites in San Jose, a Quality Inn in San Jose and the Best Western San Benito Inn in Hollister.

Panchal’s father brought his family, including Dhaval, from India to the United States in 1970. Four years later, his father scraped up enough money to buy his first hotel, an 18-unit building in San Jose. His mother, Manorama, was the manager and did maintenance and housekeeping. Nearly a year later, a second hotel was purchased.

The family company was looking to diversify its holdings out of the Bay Area and to expand, specifically to Maui, said Panchal, who gave up a successful legal career to lead the family business. He said he had been looking for a property for many years, adding that there is a “high barrier” to entering the market in Hawaii.

“When the opportunity came, I just jumped on it,” Panchal said. “To be honest, I didn’t think I had a shot.”

Panchal has big plans for the Kohea Kai, which he would like to make the flagship of the family’s hotel portfolio. The property’s name was changed to reflect the intended experience of the resort and to give it “our own brand and identity,” he said.

It will be a place for guests to relax in peaceful gardens and clean rooms and to catered to by a good staff, Panchal said.

The resort will offer free breakfast and 24/7 “grab and go” food options, he said, with a deli license expected to be completed by the end of the month. Eventually, the goal is to open the Kohea Kai Bistro, a commercial kitchen that will offer 24-hour food service to guests and the general public. It will offer seven or eight signature grab-and-go items.

He wants to offer local food and is working with Maui vendors. After meeting with Maui Upcountry Coffee representatives recently, he said Friday that the resort will be serving the brand with breakfast.

Other amenities include free Wi-Fi, parking, ice and beach items, Panchal said. He did not want his guests to feel “like they are nickel and dimed”; he wants them to feel like they only have to pack their shorts and slippers.

The resort is now listed on Expedia, Panchal said Friday. A new website is currently being built. Painting of the resort starts Monday and will take about six weeks.

Neither Panchal nor Spence disclosed the sales price for the resort, which sits on about 1 acre on four lots; the county assessed the four lots along South Kihei Road at $4.4 million.

Spence bought the two lots closest to the beach for $4 million. He later expanded the Sunseeker’s footprint and room numbers, from 17 to the current 26. He purchased the adjoining property in a stress sale in 2010 for $775,000 and was awarded an adjoining property to that parcel in foreclosure in 2011 for $900,000.

His first visit to Maui was in 1978, and Spence said he “fell in love with the place.” He worked on Wall Street and, by 2007, had risen to head the sales trading division of ING bank. It was the year before the recession and the markets started melting down. The time was right for a career change, he said.

Spence came out to Maui on vacation, explored businesses on the island and stayed at the Sunseeker. He loved the place and bought it.

Spence had never run a hotel before but used his extensive experience as a business traveler and his understanding of “what guests prefer and guests enjoy” and his financial and marketing backgrounds to create a successful business, one that survived the recession that took hold shortly after he bought the hotel.

He said that being a resort that catered to the gay community was an advantage during those years because that group tended to have higher disposable income and traveled more than the general public.

The Sunseeker offered an “experience of Maui, not an experience on Maui,” Spence explained. “It was very popular and very successful.”

Except for the occasional tack ball thrown from the street, Spence said that “overwhelmingly, the people of Maui have been very supportive . . . (of) what we created and what we did.”

He is stepping back, hoping to delve more into nonprofit work, traveling and getting married to his partner, Jim Batchelder, in November. He remains involved in the ownership transition and is helping build the marketing with Panchal.

“I will say it is a bittersweet time, because I really do care for the property quite a bit,” Spence said.

* Lee Imada can be reached at leeimada@mauinews.com.

* This article includes a correction from the original published on Sunday, Sept. 18, 2016.