The financially troubled The Residences at Kapalua Bay has been sold for $100 million to a entity incorporated in Delaware, the court-appointed commissioner in the foreclosure case said Thursday.
First Circuit Judge Bert Ayabe in Honolulu on Thursday confirmed the sale of the foreclosed ultra-luxury condominium and time-share project to Island Acquisitions Kapalua LLC, said Honolulu attorney and court-appointed commissioner George Van Buren, in an email.
In December, an auction was held for the residences, with the highest bid coming in at $55 million from Island Acquisitions Kapalua LLC.
But on Thursday at a scheduled confirmation hearing, the sale was reopened because at least one new bidder came in at 105 percent of the current top bid, or $57.75 million.
There was further bidding, with Island Acquisitions again coming out on top with the winning bid of $100 million, Van Buren said.
He added that it generally takes two months before the property is conveyed to the purchaser. After closing, Island Acquisitions will own the majority of the units in the development, he said.
John Chaney, president of the Kapalua Bay Vacation Owners Association, said that the association is delighted that several months of uncertainty have come to a close with the sale. The part-time Maui and Houston resident said via phone from Texas that the association also is looking forward to working with Island Acquisitions on a new strategy for the property.
Chaney declined to disclose details about Island Acquisitions Kapalua, saying that the entity should be the one to tell the press about itself. Chaney did say, though, that the entity is "well-funded."
Island Acquisitions Kapalua LLC was not listed in the state's Business Registration Division online database Thursday.
Overall, Chaney said that the sale was good news.
"Today the sun is shining," he said.
In January, Colorado-based Timbers Resorts took over management of the condominium and time-share project from Ritz-Carlton Management Co. The management issue is separate from the foreclosure case.
Officials from Timbers Resorts did not immediately return messages for comment on the sale Thursday.
Officials from the Kapalua Bay Vacation Owners Association and the Association of Apartment Owners of Kapalua Bay Condominium had said at that time that they were pleased with Timbers Resorts taking over management of the properties.
In December, 65 of the residential condominiums and 567 fractional-ownership interests in the property's 62 time-share units headed to the auction block. The units and time-share interests that were being auctioned off were those that the developer had been unable to sell. The auction also included leasehold interest in The Shops at Kapalua, a spa and other amenities.
When the project opened in mid-2009, on the site of the former Kapalua Bay Hotel, it was touted as "destined to become Maui's most cherished luxury homes."
But project developer Kapalua Bay LLC - a joint venture among affiliates of Maui Land & Pineapple Co., Exclusive Resorts and Marriott International - ended up owing more than $304 million in principal and interest on the property.
The land and buildings have a combined assessed value of $284.4 million for tax purposes, according to a fact sheet for the auction.
The residences portion of the project is made up of 84 wholly owned condominiums that were initially priced between $3.9 million and $9.8 million. The project's 62 time-share units each have 12 fractional-ownership interests, and individual interests were initially priced between $350,000 and $850,000.
Lenders for the project - led by German bank Landesbank Baden-Wurttemberg - foreclosed on the property in June in 1st Circuit Court.
* Melissa Tanji can be reached at mtanji@mauinews.com.
