CRAIG T. KOJIMA / CKOJIMA@STARBULLETIN.COM Outrigger Enterprises says it is working with a list of prospective investors into its 280-room Ohana Islander Waikiki at 270 Lewers St., above yesterday.

Outrigger seeks partner for Beach Walk hotel

Outrigger Enterprises Group is seeking to sell a stake in its Ohana Islander Waikiki hotel to generate the capital to redevelop the anchor property, part of its Waikiki Beach Walk redevelopment project.

The company is looking for joint venture partners to help reposition the 280-room hotel, on the corner of Lewers Street and Kalakaua Avenue at the mauka end of the Beach Walk project, into a 147-room luxury boutique hotel.

Outrigger said it is working with a short list of prospective investors for the hotel at 270 Lewers St. At least a dozen potential partners have looked at the property, which will offer suites of about 610 square feet.

Outrigger, which began marketing the property in June, would retain a minority interest and operational control in the hotel, while partially investing in renovations estimated at between $35 million and $40 million.

"We would be the managing partner in the venture," said David Carey, Outrigger's president and chief executive officer.

The property, which houses Quiksilver and the Wyland Gallery, was scheduled for renovations starting in November as part of the Beach Walk project's second phase, with completion slated for September 2008.

However, start of construction has been pushed back until April 2008 because of financing delays, stemming from the uncertainty in the credit markets due to the subprime lending meltdown, Carey said. Instead, the company is working on the design and building model rooms this fall.

Outrigger is in the process of a $100 million renovation of the Outrigger Reef on the Beach as part of the Beach Walk project, now estimated to cost more than $560 million.