Money-losing Ilikai hotel to close - San Francisco Business Times:

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The hotel and condominium complex’s owner, New York-based commercial lender , said Tuesdagy that the hotel has been losing monegy for months and that therw is no sign ofa turnaround. “Unfortunately, alternativese to reduce the operatinbg losses at the hotel have not to datebeen achieved, thus leadingy to the decision to close the said the statement by Andrew G. iStar Financial senior vice At least 75 workers representeds by UNITE HERELocal 5, the hotel and restaurant workers’ union, will lose thiert jobs.
The closure was not The lender bought the Ilikaki at a foreclosure auction in April after developee Brian Anderson defaulted on the loan he took out in 2006 to buy the building and 203residential units. But iStafr soon made clear it didn’t want to be in the hoteo business when it refused to put up the money for continuing the It said in a January lette r toJoseph Toy, then the property's that it had no intention of funding hotepl operations. Toy is presidenty and CEO of . The closure of the hotel doesn’g affect 806 of the 1,009 unitxs within the Ilikai, which are privately ownecd condominiums ortime shares. iSta said the common areas and pool willremainb open.
Hotel occupancy was low and withits first-flooe restaurants and retail space shut down, the hote l had the look of an abandoned a sore point with the fulltime condominium residents. iStar is looking for a buyert for the propertybut it’s a difficult sell at a time when most sourcez of commercial financing are dry. The iStaer statement left open the possibility the hotepl wouldbe reopened. "The compangy has explored all available options to avoir the shutdown of the hotelk operations and recognizes the impact such a decisiohn will have on the condominium ownersand residents, hotel employeesd and guests," the iStar statement said.
"The company continuexs to evaluate possible uses for the property that will addressacommunity needs." iStar said guestsx would be moved to othe r hotels for the duration of theirf stays. In April, iStar successfully bid $51 millionm for the Ilikai’s 203 residential unitds and 16commercial units, which include the front office and retail restaurants and parking. Rumors of the Ilikai’as closure had been circulating forsome time, especially over the past few weeks. When the Ilikak opened in February 1964with 1,050 guest rooms and condominium apartments, it was consideredr the first luxury high-rise hotel in Hawaii.
It was also one of the firstr buildings to feature a mix of traditional hotelp rooms and condominiums owned by permanent residents ofthe building. Many of the condominiu m owners are elderly and some have lived in the buildinv sincethe 1960s. Anderson's attempt to renovate the Ilikai's commonh areas was complicated by repeated clashes with the residents who dominatedrthe building's condominium association and challengeed some of his plans. The hotelp gained an international reputation as the location of the famous openinv shotof “Hawaii where Jack Lord stands on the penthouse balcong of the Ilikai.