Hanalei Bay Resort Management Not Meeting Expectations

published on July 6, 2009 by

Located on the north shore of Kauai in Hawaii, the luxurious Hanalei Bay Resort is looking at many unhappy owners these days. Quintus Vacation Management, who was supposed to manage the property through 2012 sold the contract to Celebrity Resorts last August without notifying the Hanalei Bay Resort Vacation Owners Association board members or the Association of Apartment Owners. Under the new ownership, the property’s condition is not showing improvement. Even the Bali Hai restaurant, with one of the best views on the island overlooking the Hanalei Bay, has been closed for a year and a half with no plans to re-open.

Owners have been voicing their concerns over the condition of the property for a few years now and were surprised to learn that despite having their fees raised in 2008 the resort was operating at a deficit and there are no reserve funds to begin renovation of outdated units. Owners have requested that Celebrity Resorts management company be removed, but, to no avail. Now the VOA and AOAO are working together against Celebrity Resorts to terminate their contract. Previous VOA board members are being ignored and Celebrity Resorts instead appointed their own board members, which included three of the company’s senior officers. Legal actions have already begun on that front to determine who the legitimate board of directors is for the VOA. More lawsuits may follow.

“Hanalei Bay Resort should be run by boards consisting of individual owners and in a fiscally approved manner, where management companies report to owners,” says Peter Somerville, a timeshare owner at the resort. “It’s a conflict of interest to serve on the board of a property in which they manage.”

Celebrity Resorts does seem to be recognizing AOAO board members, but they are not being given important information such as company financials. “We really feel the management company should report directly to the AOAO board,” said Kent Oehm, President and timeshare owner. “We’ve been trying to keep the resort going and one of things we’re concerned about is getting the restaurants open.”

On a good note, unconfirmed sources say that the Happy Talk lounge is scheduled to re-open either this month or next, which could mean that Celebrity Resorts is finally starting to turn things around. If you have more details, we invite you to post your comments below.