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The Honolulu Advertiser
Posted on: Thursday, May 6, 2010

Resort buyer aims to be a 'trendsetter'

By Alan Yonan Jr.
Advertiser Staff Writer

Looking to capitalize on opportunities in the depressed market for resort properties, a local hotel industry veteran has formed a company to buy resorts in Hawai'i, Southeast Asia and on the Mainland.

The Taylor Group International LLC is working with several private equity groups to "acquire and create" four- and five-star resorts, said principal Mark Taylor.

Taylor is the former vice president of design and construction for Kyo-ya Management Co. who helped oversee Kyo-ya's recent renovations of the Royal Hawaiian hotel, Moana Surfrider and Sheraton Waikiki.

"Because of the economy and the so-called AIG effect, resorts have suffered significantly in the last downturn, which has negatively affected values," Taylor said in a news release. "While transaction activity remains stunted, we believe that over the next 12 to 18 months there will be a significant increase in acquisition opportunities. However, buying solely on price will only start the cycle again," Taylor said.

Taylor said the company plans to grow at a "measured rate," adding just one to two properties a year.

The number of resort-related loan defaults globally has soared over the past year or so and now stands at $32.3 billion, according to real estate research firm Real Capital Analytics Inc.

In Hawai'i, at least 11 hotels were in foreclosure or threatened by foreclosure in the first quarter, while four were for sale, according to a recent report from brokerage firm Colliers Monroe Friedlander.

Hawai'i hotels that are in foreclosure or have been taken over by their lenders include the Ilikai in Waīkīki, the Fairmont Orchid Hawaii luxury hotel on the Big Island, and part of Makena Resort that includes the former Maui Prince Hotel.

The Maui Prince is scheduled to be auctioned May 28.

The Taylor Group will seek out full-service hotels with 200 to 400 rooms and contract with management companies to run the properties, he said.

"What will set our properties apart is creating a four- and five-star resort experience through cutting-edge design and service," Taylor said.

"We are on the cusp of a new generation of hotels and resorts, and we intend to be trendsetters that attract and retain guests and generate higher profits."