Aqua shuts Waikiki hotel for extensive renovations

When Aqua Hotels & Resorts entered Hawaii's hotel market in 2001, it needed to fill rooms immediately, so low prices became the company's strategy. Now, it's all about upmarketing and renovation.

The Aqua Coconut Plaza is slated to close today for multi-million dollar 90-day overhaul, the company's newest renovation project.

Hotel rooms at the property, owned by 3D Investments of Century City, Calif., used to retail for around $70 a night when it was part of ResortQuest Hawaii's budget inventory.

Aqua Hotels & Resorts, which took over management of the hotel at the end of 2007, expects to boost room rates at the property to $120 immediately following the renovation, and double them by 2010.

"In this market, where our value-minded customers are increasingly looking for added amenities rather than lower prices, renovation always pays off," said Mike Paulin, Aqua's chief executive officer. "We won't manage any property that's owners aren't willing to upgrade."

Eight of Aqua's 11 properties have already been renovated, and overhauls are planned or ongoing at the other three, Paulin said. The renovations are part of a repositioning effort launched when the company created its Aqua Boutique Collection in 2005 to appeal to the sense of style and attitude of savvy young travelers.

"We've found that visitors to Hawaii are looking for more than value," Paulin said.

While the wave of hotel overhauls in Waikiki has been ongoing for several years now, renovation in the primary markets has forced off-beach and ancillary properties to follow, to justify the increase in room rates, said Murray Towill, president of the Hawaii Hotel and Lodging Association.

"It's about keeping up with the Joneses," Towill said. "Also, here in Hawaii, visitors have already gotten over the expense threshold just to make the decision to come, so they generally have higher expectations when they are here."

Aqua's most recent renovation will reposition the 81-room Aqua Coconut Plaza hotel, located at 450 Lewers Street, as the Coconut Waikiki Hotel, as part of Aqua's more upscale Boutique Collection.