Planning panel gets first look at airport hotel project

Windward Hotel would have 200 rooms, pool, other amenities

A triangular plot of land between Airport Road and Kala Road (center of photo) near Kahului Airport is the proposed site of the Windward Hotel. R.D. Olson Development has proposed a business traveler-geared hotel on 5 acres of the Maui Business Park Phase II. This photo was taken Tuesday afternoon. -- The Maui News / MATTHEW THAYER photo

WAILUKU — Maui Planning Commission members queried developers of a new hotel on issues of parking, water and the need for another hotel near the airport Tuesday — the first time the project appeared before the commission.

R.D. Olson Development has proposed a business traveler-geared hotel on 5 acres of the Maui Business Park Phase II, land currently owned by A&B Properties Inc. The four-story Windward Hotel would include 200 rooms and come with onsite amenities, including a swimming pool, dining area, sundry shop, laundry room, ballroom, board room business center and other support services. Plans also call for 227 parking stalls.

The hotel would occupy a triangular plot of land near the entrance to the Kahului Airport, bordered by Haleakala Highway and the Airport Access Road.

R.D. Olson developed and formerly owned the nearby Courtyard Marriott, where the occupancy percentage rate was often “in the mid-90s, which is considered fully occupied,” said Tony Wrzosek, vice president of planning and development for R.D. Olson.

“During our ownership, it maintained an extremely high percentage of occupancy, thus encouraging our office to look at further sites for a second hotel,” Wrzosek said. “Based on the success of the Courtyard, we truly believe that there is a demand, an unmet demand, of more hotels of this type within this market adjacent to the airport.”

Because the property is zoned for light industrial and does not allow for hotels, the project would require a community plan amendment and hotel zoning.

The project proposes a maximum daily potable water demand of 105,870 gallons per day, according to the draft environmental assessment. Proposed nonpotable water needs are 5,520 gallons per day. Right now, water for the project site is provided by the Maui Business Park’s private water system, which A&B built in 2011 and currently owns and operates.

Water resources consultant Tom Nance said the potable supply “will primarily come from the Iao aquifer,” but that it would also draw from the Kahului aquifer.

“To date, this (hotel) is the only one where usage far exceeded what planned water use for the site was,” he said. “So they’re using water from the Iao aquifer, but everything else in the (business) park, unless there’s a change, will be supplied by the two potable wells in the Kahului aquifer.”

However, commission member Larry Hudson said he wanted to see R.D. Olson seek out an additional water source, which the developer said in its assessment it is not pursuing.

Commission member Christian Tackett also had concerns about R.D. Olson developing another hotel so soon after developing, owning and selling the Courtyard Marriott, which originally opened in 2012. County real property tax records show the property was sold in May 2017 for $39.2 million. The current owners are SPMH Maui LLC.

“That’s kind of a concern of mine, that you’re going to build a hotel, you’re going to sell the hotel, you’re going to build another hotel that’s going to take clientele away from the hotel that you just built that you sold to somebody else,” Tackett said. “On top of that, you’re going to have two other hotels that are ready to come up for some sort of remodel some day.”

The Maui Beach and Maui Seaside Hotel are barely 2 miles away from the proposed site.

Wrzosek said R.D. Olson wouldn’t have proposed a 200-room hotel if it didn’t think the demand was there.

He added that as for the older hotels nearby, “this is the cycle of development we see often, that longtime owners of old hotels do not reinvest within their property.”

“New hotels encourage that the old ones upgrade,” Wrzosek said.

When asked about parking, Wrzosek said he believed 227 stalls would be sufficient for both guests and workers. The one-to-one, room-to-stall ratio is greater than R.D. Olson’s other properties on Maui, and as an “upgrade select-service hotel,” the Windward Hotel would not have the large banquet facilities and separate restaurant that often bring outside guests to other hotels. Wrzosek added that the additional stalls would cover the 27 employees on shift; he expected the hotel to have three people on staff at night.

As for whether R.D. Olson planned to build units or purchase credits to fulfill its affordable housing requirements should the hotel be approved, planning consultant Jordan Hart said that remained undecided.

“I don’t think there’s a direct plan to do a separate construction project for building units,” he said. “But basically the agreement is generally executed before building permit issuance. So sometime between now and then it’ll need to be done.”

The project is accepting comments on its draft environmental assessment through Sept. 7. Tuesday’s visit to the commission was the just the first of many steps.

After producing its final environmental assessment, the project must pass through the Maui Planning Commission, the state Land Use Commission and the County Council, a process that Wrzosek estimated could take another year and a half.

* Colleen Uechi can be reached at cuechi@mauinews.com.

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