Mauna Lani gets $200M overhaul

HONOLULU — The Mauna Lani will reopen by January as the state’s first hotel in the luxury Auberge Resorts Collection after doubling its renovation budget to $200 million.

The arrow-shaped Hawaii Island resort, which will began taking reservations Monday for stays next year, is commemorating its reopening with a special kamaaina rate of $299 per night, significantly lower than the property’s new average daily rate, which is expected to range from about $550 to $10,000 per night following its overhaul and re-branding.

The resort closed in October, triggering temporary layoffs for about 400 employees, to make way for the most extensive renovation undertaken since the property was developed by a subsidiary of Tokyu Corp. Noboru Gotoh, former chairman of Tokyu Corp., opened Mauna Lani Bay Hotel &Bungalows in February 1983 at a cost of $71 million.

DiamondHead Land, a joint venture between San Francisco-based ProspectHill Group and Hawaii-based hotel executive Pat Fitzgerald, and another major institutional investor, purchased the 32-acre oceanfront property in August 2017 for $225 million.

While renovation costs are approaching purchase costs, the resort’s ownership group “saw the value in redoing all of the guest rooms, adding more pools and restaurants and more connections to the community,” said Sanjiv Hulugalle, who formerly opened the Four Seasons Resort Oahu at Ko Olina and has returned to Hawaii as the Mauna Lani’s vice president and general manager under Auberge.

Hulugalle said the renovation will reduce the hotel room count to 333 from 368, allowing the resort to enlarge some rooms and increase its suite count to 38 from 23. The resort is expanding to three pools, adding a keiki pool and an adults-only pool to its original family pool.

It also will add new shops and expand its food and beverage offerings to five from two choices, including bringing back the Canoe House and adding the Halani, a breakfast, lunch and dinner spot; the Ha Bar, with mixologists poolside; The Surf Shack, a coastline eatery; and The Market, offering local merchandise and treats like coffee, gelato and New York-style deli food.

“The changes were purely based on what the market needed. People want to come with families, and they want to have rooms that are connecting and flexible,” Hulugalle said. “We also wanted to make the resort more active.”

To that end the renovated resort will debut the Kainalu Academy, a center for outdoor pursuits that includes a fitness and tennis center and its own surf shack and dive center. Guests also will have access to paddling, boating and outrigger canoe excursions. The knowledge center off the hotel lobby, will provide a place for guests to learn about Mauna Lani, which means “mountain reaching heaven” in Hawaiian, and the Kohala Coast.

“It expands what Danny Akaka Jr., our cultural historian, has been doing here for years,” Hulugalle said.

The addition of the Francis Ii Brown hospitality room will allow the resort to cater to small groups of anywhere from 50 to 75 guests.

“Auburge is known for world-class luxury, one-of-a-kind food and beverage experiences, connecting to the community and creating an experience that is part of a soulful journey,” Hulugalle said.

Hulugalle said Auberge, which will expand to 30 resorts in the next 18 months, is known for having a portfolio of properties that command the highest average daily rates and affluent guests who expect the highest level of service. The resort hasn’t even reopened, and Hulugalle said there are already 50 employees on staff. He expects a fully staffed resort will mean increasing the employee count to about 600, with about half comprising returning employees who were working there before the temporary closure.

“We’re hoping that we’ll get about 300 of our former employees back to continue the story of this amazing place,” Hulugalle said. “They have a deep connection to the culture, the ocean and everything that we are about to create.”

The reopening of the resort under the new brand is expected to benefit Hawaii island’s tourism economy, which has struggled to come back from last year’s Kilauea eruption in Lower Puna.

“We haven’t had a new brand for the Kohala Coast since last year when the Westin Hapuna brought in a new management team and marketing partnership,” said Stephanie Donoho, administrative director for the Kohala Coast Resort Association. “We’re hoping to see continued pickup from Sanjiv’s team pushing the Auberge and trying to implement new ideas on how to make the resort a vibrant location.”

Donoho said tourism along the Kohala Coast is finally stabilizing but hasn’t yet returned to the pinnacle it reached in April 2018.

STR, a data and analytic company, reported that through the first four months of the year, Kohala Coast hotel occupancy averaged 78.6%, down nearly 2 percentage points from the same period in 2018. At the same time, the average daily room rate was $395, a more than 3% dip, and revenue per available room was down more than 5% to $310.