Corona del Mar-based Wise Hotel Investments has brokered the $25 million sale of Hawaii’s Outrigger Kauai Beach Hotel to West Palm Beach, Fla.-based Driftwood Ventures.
The sale is the first in Hawaii for Wise Hotels, though President Don Wise said he expects to handle at least one more deal there this year.
Driftwood Ventures is a former Holiday Inn franchiser that is making its first venture into Hawaii with this purchase. The company bought the property from KH Hotel Partnership, a Japanese venture. Driftwood will invest about $10 million in renovations to the 341-room beachfront hotel near Lihue and rename it the Kauai Beach Resort.
The hotel, once a Hilton before it became the Outrigger, will be operated by Radisson under a franchise agreement.
The Hawaiian market is driven by Japanese landowners who acquired real estate there in the ’80s and who now need to sell assets due to the sluggish state of the Japanese economy, according to Wise. He estimates there is up to $7 billion in Japanese investment remaining in Hawaii, where the state is enjoying a recent rebound in the number of visitors, boosted in part by a 4% increase in visitors from Japan in April.
Wise, who represented Driftwood in the transaction, said the makeover will include an upgrade to all guest rooms and the lobby and include a sand pool and a waterfall at the entrance. The Honolulu office of architects Wimberly Allison Tong & Goo Inc. is designing the changes.
