Dell's Big Island hotel struggles
December 8th, 2009 by RickWhen computer mogul Michael Dell and his partners paid a reported $500 million to buy the Four Seasons Hualalai more than three years ago, they touted it as a long-term investment.
They may have to hold it for a much longer term before they break even.
The Wall Street Journal reported on Monday that the Big Island resort's annual cash flow has plunged to about $7.9 million from $20.6 million in 2006. (See:)
The Journal, citing loan documents, said the hotel's occupancy has declined 33 percentage points to 54 percent.
Dell, founder of Dell Inc., and his partnerships own the Four Season Maui and the Kona Village Resort on the Big Island, which also are likely struggling from the downturn in high-end tourism in Hawaii.
The Journal article also mentioned Montage Hotels & Resorts, which is backed by local resident and eBay Inc. founder Pierre Omidyar.
The Journal noted that occupany rates at the Beverly Hills Montage have sagged to about 60 percent.
Tags: Beverly HIlls Montage, Dell Inc., Four Season Hualalai, Four Seasons Maui, Kona Village Resort, Michael Dell, Montage Hotels & Resorts, Pierre Omidyar
December 8th, 2009 at 4:33 pm
[...] it seems Michael Dell’s investment in the Four Seasons Hualalai and Kona Village Resort is not looking like such a great deal now due to the ongoing economic [...]
December 9th, 2009 at 10:51 am
Proof that business people should stay with what they know. No matter how big you are one has limitations on expertise.
Aloha,
Keahi
December 9th, 2009 at 3:01 pm
The downturn leaves no one untouched. It is not fair to report that revenue and numbers have dropped in bad times. That can, and is the case for virtually everyone.
What is noteworthy is if the hotel cannot improve or hold its own during good times.