Unity House offers $8.5 million for Lotus Diamond Head


POSTED: Wednesday, August 19, 2009

Unity House Inc., a non-profit serving labor workers, put in the highest bid of $8.5 million for the Lotus Diamond Head Waikiki at a foreclosure auction this afternoon at circuit court.

The bid is still subject to confirmation in circuit court, although a 10 percent deposit was required at bidding time.

State-appointed commissioner Richard Emery had a list with the names of five potential bidders.

The bid was 5 percent higher than a bid of $8.1 million by creditor Central Pacific Bank, which holds a second mortgage on the property. First Hawaiian Bank, which holds the first mortgage on the property, put in an initial bid of $5.7 million.

The Lotus at Diamond Head, a 51-room boutique hotel formerly known as the W Honolulu-Diamond Head at 2885 Kalakaua Ave. went into foreclosure under the ownership of Big Island developer Brian Anderson’s Anekona W LLC.

Emery originally scheduled the auction in June, but Anderson filed for Chapter 11 bankruptcy before it could take place.

Judge Robert Faris approved a motion last month to dismiss the case.

In a hearing earlier today, Faris almost granted Anekona another week to put together a potential deal with an interested buyer, based on Anderson’s claim that there was one.

But Judge Faris eventually cleared the way for the foreclosure auction to proceed.

At the confirmation hearing, other buyers can still come forward with a bid that is 5 percent higher than the one offered by Unity House, which would reopen the auction process.

The hotel remains open for business under the management of Castle Resorts.