Resort developers hot on Kauai

Waipouli condo resort project turns into a $200 million blockbuster

The Outrigger Waipouli Beach Resort & Spa on Kauai, scheduled to open Dec. 1, is aiming for five stars.

What originally was envisioned as a $100 million condominium resort in 2004 evolved into $200 million, according to development partner Keith Singleton of Waipouli Beach Resort LLC.

OUTRIGGER WAIPOULI BEACH RESORT Location: 4-820 Kuhio Highway, Kapaa, Kauai Cost: $200 million Site: 12.6 acres Units: 196 Sales prices: $850,000 to $2 million

"Our goal is to meet all the criteria of a five-star resort, and Outrigger is going to help us get there," Singleton said. "We went for all of the upgrades because we felt that the market was there."

The 196-unit, fee simple resort broke ground in the summer of 2004, and will be part of Outrigger Enterprises Group's collection of 14 resort condominiums. Room rates range from $245 to $755 per night during the regular season.

Besides a 300,000-gallon saltwater pool with water slides, sand-bottom whirlpool tubs, and a sand-bottom children's pool, the condominium resort will offer a 5,000-square-foot Aveda Lifestyle Salon and Spa, set to open next year.

It is the first time Aveda Corp. is opening a full-service salon in a resort condominium in Hawaii, complete with massage huts in a tropical garden.

Aveda also has a full-service salon and spa at Ala Moana Center, as well as several concept salons throughout the islands.

"Aveda is a world-renowned company," Singleton said of the $3 million spa investment. "People from Europe and the U.S. are familiar with Aveda."

The development team decided to go all out on amenities to bring a new level of luxury to the Waipouli coast, also home to the former Courtyard by Marriott Kauai, which has been rebranded under new ownership as the ResortQuest Kauai Beach at Makaiwa.

The Waipouli resort will have Indonesian hardwood base moldings, Peruvian travertine floors, and Subzero and Wolf appliances.

The Tahitian Lanai Bar & Grille is set to open poolside by the end of the year, along with a 12,000-square-foot theme restaurant next year.

Singleton said the upgrades were a result of peak market demand at the time the development team began sales in the summer of 2004.

Though sales to second-home owners were strong, Singleton said a third of the units went to local investors from Maui, Kauai and Oahu.

Prices started in the low $600,000s when sales were launched in 2004, but have since climbed to $850,000. Oceanview units start at $1.5 million, while beachfront units are set at $2 million and up.

The resort home market is softening, according to the most recent report by real estate analyst Ricky Cassiday, with sales down about 30 percent and average prices down about 3 percent in the first quarter of this year compared to last year.

Yet Cassiday still gave the Waipouli Beach project high investment marks.

"They did a great land buy," Cassiday said. "This is the first new product in Kauai in a very long time that's on the beach. They're decent units with great views and a good location."

Most of the surrounding properties are aging, he said, or leasehold.

This is the first condominium resort project by Keith and Chris Singleton, brothers who also developed Cook's Landing in Kona on the Big Island, and Makaleha Falls, a subdivision on east Kauai.

The Singletons bought the 12.6-acre Waipouli lot in 2002 from Niu Pia Farms for $5 million, according to Singleton.

Construction loans came from Fremont Investments & Loans and Bank of Hawaii.