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Nautilus II sub The Ko Olina Resort & Marina could soon tout a new $300,000 attraction -- the Nautilus II sightseeing boat -- pending a sale in the bankruptcy case of the vessel's owner.
may be docking
at Ko Olina
The resort has received
preliminary approval to purchase
the $300,000 vesselBy Tim Ruel
Star-BulletinKo Olina Activities LLC has received preliminary court approval to purchase the 50-seat Nautilus II from its owner Nautilus Sub Sea Adventures Inc.
Honolulu-based Ko Olina is an affiliate of Ko Olina Partners LLC, a company run by Jeff Stone and Kevin Showe, developers of the billion-dollar, 716-acre West Oahu resort.
The Nautilus II is a "semi-submersible craft" that floats on the ocean and allows passengers to watch under the sea from windows in the hull. The craft used to operate out of Kailua-Kona on the Big Island, but now sits unused at Barber's Point, a short distance from Ko Olina.
If the sale is approved, the attraction could be ready by next year and would add to the success of the property's JW Marriott Ihilani Resort & Spa, said Ralph Harris, asset manager for Ko Olina Activities.
"As you develop things out there, it needs accoutrements," Harris said yesterday. "There's a terrific reef out there."
Long-time Hawaii tourism executive Roy Tokujo would manage the business, Harris said. Tokujo, board member of the Hawaii Tourism Authority and chief executive of Cove Entertainment Inc., could not be reached for comment.
Harris did not offer further details, describing plans as preliminary.
U.S. Bankruptcy Judge Lloyd King informally approved the sole bid for the submarine Monday afternoon, but still must give a final order for the cash transaction to go through. A follow-up hearing is scheduled for next week.
Honolulu-based Nautilus and its affiliate, Nautilus Adventures LP, filed separate Chapter 11 reorganization bankruptcies on May 22, shortly before a federal court could finalize a foreclosure on the vessel. Nautilus Sub Sea, which began business in 1991, listed assets of $686,847 and liabilities of $1.1 million. It also owns a small hard-bottom boat called the Moki Mary, which it plans to offer for sale at $50,000, and three buses, said Don Spafford Jr., attorney for the two bankrupt companies.
The sale of the Nautilus II should erase some of Nautilus Sub Sea's debts to creditors, which include Bank of Hawaii and the state Transportation and Tax departments, according to Spafford.
One potential problem for the deal, however, is Nautilus Sub Sea's recent motion to dismiss the bankruptcy in favor of alternative financing, which would curtail the sale, he said. But creditors want to covert the Nautilus Sub Sea case to a liquidation, which would allow the sale, Spafford said.
Meanwhile, Nautilus Adventures is not seeking a dismissal of its case, and wants more time to make reorganization plans, Spafford said. The company has listed $687,670 in assets and $438,979 in liabilities, and owns another sub in Kewalo Basin, the Nautilus V.
Spafford said Judge King could rule on some of those motions next week, as well as the sale of the Nautilus II.
The original development of Ko Olina began in the late 1980s, when Herbert Horita and a Japanese partner announced plans for up to 11 hotels, luxury condominiums and about 5,000 homes on 1,000 acres. An 18-hole golf course, the Ihilani and some condos were built, but financing fell through for the rest. Ko Olina Partners LLC bought the resort, golf course and much of the land in the late 1990s, and announced plans for the 43-acre marina, new homes and time-share rentals.