Maui Land & Pineapple Co. and its partners in the Residences at Kapalua Bay have found new lenders to replace Lehman Brothers, which declared bankruptcy in September. Most of the money will come from lenders or investors who participated in the original package, but two German banks will bring $55 million of new money to replace commitments that Lehman cannot fulfill. On Monday, ML&P President Rob Webber said: "It is a good result for the company," because it establishes clearly that the luxury project will finish on time at midyear. How fast units then will sell remains uncertain, although Webber says there was strong interest in the Residences from attendees at the Mercedes-Benz Championship golf tournament over the weekend. Now everything will depend on whether buyers can find credit. In the restructuring, Central Pacific Bank will become the administrative agent for the new loan package. CPB is a $20 million participant, and it funded the first pulse of the construction. Most of the remaining money will be $35 million from Lehman Brothers Holdings Inc.'s estate in bankruptcy, and $55 million in new commitments from two German banks: Deutsche Hypothekenbank and Landesbank Baden-Wurttemberg. Another early participant, Swedbank, will maintain its $20 million share, and Marriott will up its original $17 million investment by another $10 million.
The joint-venture partners and the original banks had advanced a total of $19 million to keep construction going since September. The project, which occupies the site of the former Kapalua Bay Hotel, will have 146 residences, 84 to be sold individually as The Ritz-Carlton Residences, and the remainder as fractions in The Ritz-Carlton Club.
