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New York-based iStar Financial closed the Ilikai's 203 hotel units on July 9 after losing several hundred thousand dollars per month on the struggling hotel. If the new contract is ratified, the property will reopen “as soon as practically possible under a new management team and operational structure,” said Andrew Backman, iStar Financial’s senior vice president of investor relations.
“We are pleased that this new agreement will allow all of us to move forward,” said Backman. “We believe in Hawaii and recognize the importance of this iconic property to the community.”
The new agreement provides for more efficient hotel operations, an improved cost structure and the rehiring of approximately 50 Ilikai employees, many of whom have been with the hotel for more than 30 years.
“We look forward to working closely with the union to achieve the long-term viability of the hotel, which would provide the continued employment opportunities we all desire,” Backman said. “We are optimistic that this new agreement will not only help to preserve jobs but also to achieve the operational efficiencies that are needed to succeed.”
Backman cautioned that it will take more than just the new agreement to keep the Ilikai open in the long run.
“The benefits of a more efficient hotel operation need to take effect along with improvements in the overall economic conditions and the Hawaii tourism industry,” he said.