Lehman Brothers Holdings has hired Jones Lang LaSalle's Hotels & Hospitality Group to sell The Ritz-Carlton, Kapalua, according to a news release from Jones Lang LaSalle on Wednesday.
Bloomberg is reporting that Lehman, which held a $260 million loan on the resort, has been intending to sell assets to help pay creditors when the timing was right.
The 54-acre luxury resort has 297 hotel rooms and 107 condominium units - of which 73 are unsold and developer-owned - meeting spaces, a spa, and six food and beverage outlets, Jones Lang LaSalle said.
The Ritz-Carlton, Kapalua, built on 54 acres on the west side, is on the block. Lehman Brothers Holdings has hired Jones Lang LaSalle’s Hotels & Hospitality Group to sell the resort.
The Maui News / MATTHEW THAYER photo
"The Ritz-Carlton, Kapalua, resort is a strategic and value-add acquisition opportunity that we expect will attract investor interest from around the world," said John Strauss, managing director of Jones Lang LaSalle's Hotels & Hospitality Group. "A new ownership group has the ability to capitalize on the strength of the Maui lodging market and significant compression from Oahu to drive outsized rate and occupancy growth in the near- to medium-term."
The sale price is expected to be more than $200 million, Reuters reported, citing an unnamed source.
Jones Lang LaSalle's Hotels & Hospitality Group said that it handles real estate services for luxury, upscale, select service and budget hotels; time-share and fractional ownership properties; convention centers; mixed-use developments and other hospitality properties.
With revenue of $3.6 billion in 2011, Jones Lang LaSalle said it serves clients in 70 countries from more than 1,000 locations worldwide. Among its current listings are Hyatt Fisherman's Wharf in San Francisco and the Club Med La Plantation D'albion in Mauritius.
The Ritz-Carlton, Kapalua, was built in 1991 by Maui Land & Pineapple Co. and was sold to a joint venture, including Goldman Sachs Group and Gencom Group in 2006. The hotel closed for part of 2007 for major renovations that included turning some of its rooms into condominiums.
The hotel reopened about the time of the beginning of the Great Recession and the stock market collapse, and Gencom defaulted on its loan to Lehman. With back interest, the debt reached $300 million. The lenders foreclosed in March 2011 with about $268 million owed.
In July 2011, Lehman, bidding with debt it held against Gencom, obtained ownership of the resort with a $95 million bid.