Economic problems shutter Marc Resorts


POSTED: Thursday, May 07, 2009

Marc Resorts, a hotel and condominium management company, is closing down six months after filing for Chapter 11 bankruptcy amid Hawaii's unprecedented tourism slump.

A total of five properties are affected by the closure: Molokai Shores on Molokai and Pono Kai, Pali Ke Kua, Puu Poa and Hale Moi Cottages on Kauai.

Marc Resorts also did sales, marketing and reservations for the Hotel Molokai, which is not affected by the closure.

About 40 employees were notified of the closure on Monday, according to a Marc Resorts Hawaii executive.

The company's office here is expected to close tomorrow. The company's Web site, at http://www.marcresorts.com, has already been deactivated.

“;The economic climate has created difficult challenges for a small company like ours, and we're reluctantly closing our doors,”; said the company in a press release. “;We want to thank our travel partners, our individual unit owners, and especially the people who have stayed with us over the years. We will miss them all.”;

Some properties likely will be transferred to other management companies as soon as this weekend, but Marc Resorts said it was premature to say which ones at this time.

All future guests have been contacted directly, according to the press release, as well as travel partners, including Expedia, Orbitz, Pleasant Holidays and All About Hawaii. Deposits for future arrivals will be refunded.

Marc Resorts filed for Chapter 11 reorganization in U.S. Bankruptcy Court in Arizona in November. The case was transferred to Honolulu in March. A Chapter 7 hearing is scheduled for June 22.

Marc Resorts at one time managed several properties on Oahu, including the Hawaiian Monarch, as well as the Aloha Maui Vista Resort on Maui.

Mike Paulin, chairman of Aqua Resorts, started Marc Resorts in 1987 with two properties in Waikiki, and said it expanded to as many as 22 condotels on four major isles in the next decade.

He sold Marc Resorts to Sunterra Corp., a timeshare company in 1997, which subsequently filed for Chapter 11 bankruptcy in 2000. He offered to purchase Marc Resorts at the time, he said, but his offer was declined, so he went on to start Aqua the following year.

“;Unfortunately, there was an erosion in properties that occurred over that period of time,”; said Paulin. “;The straw that broke the camel's back was the economy.”;