Starwood considering
purchase of Maui hotel
Starwood Hotels & Resorts Worldwide Inc., which manages or owns 15 properties in Hawaii, is looking to buy a resort on Maui and convert it to Starwood's W brand of properties.
Keith Vieira, senior vice president of operations for Hawaii and French Polynesia, said yesterday that talks are in the early stages for Starwood either to purchase one of the hotels it manages on the island or one it does not manage.
"Probably before the end of the year we'll have a couple major announcements in regards to large equity stakes on the island, but it's too premature at this point," Vieira said.
Starwood, which manages the W on Waikiki, revealed its intentions yesterday in conjunction with a first-quarter earnings report that showed the chain returned to profitability after a year-ago loss.
The White Plains, N.Y.-based company reported net income of $33 million, or 16 cents a share, compared with a loss of $117 million, or 58 cents a share, a year earlier. A year ago, the company booked a first-quarter charge of $170 million for asset dispositions and impairments that hurt its bottom line.
Revenue rose 13 percent to $1.23 billion from $1.09 billion.
Chairman and Chief Executive Barry Sternlicht said first-quarter results continue "the momentum we saw building in our company the past six months, especially now as the world returns to an accelerated travel pattern."
Starwood manages, franchises or owns more than 725 hotel properties in 80 countries. Its brands include Four Points, Sheraton, St. Regis, Westin and W Hotels.
Vieira, who wouldn't identify the Maui hotel Starwood is attempting to buy, said the company's purchasing mindset began last month with the acquisition of the Sheraton Kauai.
"We're looking at a larger equity stake in Hawaii," Vieira said. "In almost all cases, if we purchase a hotel, it would be with the intent of repositioning -- maybe through rebranding or renovation -- and with the opportunity for vacation ownership."
Starwood plans to begin construction next year on about 200 time-share units on an oceanfront lot it recently purchased in Princeville, Kauai, Vieira said. Starwood is also building 158 two-bedroom time-share units at Westin Kaanapali Ocean Resort Villas on Maui that will tie in to 106 units already there.
"We sold out the first phase as soon as we finished building it," Vieira said. "The sales pace is so brisk and quicker than we anticipated that we have to ensure we'll be able to get the construction process done to have the units ready for people to use following the sales."
Dow Jones News Service and Associated Press contributed to this report.