The management company for the Maui Prince Hotel and Makena North golf course announced this evening that it intends to end its operating contract—a move that could shut down both properties on Sept. 16.
The West Maui property’s possible closure was announced by its management company, Maui Prince Hotel LLC, which gave notice it would be terminating its contract and shutting down the hotel and golf operations. Maui Prince Hotel LLC said in a statement this evening that it had been unable to secure funding for the hotel and golf course’s payroll and operating expenses from the owners and lenders of the Makena Resort, on which the properties are located.
A consortium of Makena Resort lenders led by Wells Fargo Bank had filed a foreclosure action on the resort on Aug. 24, alleging that the property’s owners had defaulted on a mortgage loan of $192.5 million.
Property management company Maui Prince Hotel LLC said in its statement today that it made the decision to shut down the property when owners and lenders failed to guarantee future funding of the hotel and golf course by a deadline today.
An attorney for lender Wells Fargo said in statement this evening that Wells Fargo would act immediately tomorrow (9/1) to appoint a receiver to take over operation of the Maui Prince Hotel and Makena Resort. "If approved, the receiver and its team will transition to a new management company to be approved to operate the Maui Prince Hotel and Makena Resort," said the attorney.
Guests with questions about a future reservation may call (888) 977-4623.
The Maui Prince Hotel and Makena North golf course employs 380. The 310-room hotel has been in operation since 1986.
Wells Fargo Bank filed a request in Circuit Court this morning to appoint a receiver to take over operations of Maui Prince Hotel and Makena North golf course. In a statement released this morning, Barry Sullivan, attorney for lender Wells Fargo, fired back at Maui Prince Hotel management claims that the lender had not secured funding for the hotel and golf course's payroll and operating expenses. Sullivan said that Wells Fargo advanced $247,000 yesterday to pay the hotel's vendors and suppliers.
"The lender wants a solution but it has now become evident that there are serious operational concerns," said Sullivan, in the statement. He claimed that under current management, the hotel had been losing an estimated $1 million per month. "Despite these losses, Maui Prince (management) had been unable or unwilling to provide the lender with an accurate projection of losses and cash needs."
Sullivan also said plans are in motion to recruit a new hotel operator to take over management from Maui Prince LLC.
"We are very encouraged that local, respected hotel management companies have stepped forward and are preparing themselves to take over hotel operations on Sept. 16," said Sullivan.