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The Honolulu Advertiser
Posted on: Tuesday, March 4, 2008

COMMENTARY
Plan could put resort in 'perilous' position

By Bob Boyle

Members of the Turtle Bay Resort sales team were recently honored for exemplary performance at a conference of Benchmark Hospitality International, the company that manages the resort. As we returned from this conference, we reflected on the recent proposal that the resort be acquired by the state of Hawai'i.

First, we should note that Benchmark Hospitality recognized the extraordinary performance of the resort in conferring the awards. Notably, Turtle Bay Resort's occupancy improved by 4.4 percentage points last year, in the face of declining statewide visitor counts approximating 5 percent. Additionally, Unifocus, a company that evaluates customer service levels, reported that service as reported by guest comment cards had "dramatically improved" at the resort. More than 96 percent of resort guests report a "would return and recommend" experience.

In 2007, the resort was also named among Conde Nast's "Top 20 Hawai'i Resorts," and received two Gold awards from Meetings & Conventions magazine, along with several other industry awards.

With these achievements stated, it is important to clarify that there is a difference between the hotel, golf courses, restaurants and other active components of the hospitality product at the resort and the entirety of the 880-acre resort. The hospitality portions are managed by Benchmark, a highly respected hotel management company based in Houston, Texas. The larger resort is owned by Kuilima Resort Company, a subsidiary of Oaktree Capital.

The hotel, golf courses and restaurants provide nearly 800 jobs in the North Shore community and comprise a very successful business, as evidenced by our recent award and sales achievements. We have a very strong, experienced executive team at the helm and it is paying off. Our occupancy, gross revenues and average daily rates are better than they have ever been in the history of the resort; and 2008 is projected to be even better.

The uncertainty created by the announcement of the proposed purchase has immediately and severely affected business. A major U.S-based wholesaler removed us from its Web site, representing a potential loss of $500,000 this year in room revenue alone. We were recently notified that a travel agent monitoring company has issued an "alert" cautioning the stability of the property. Many of our group customers have called us, concerned about the fate of the hotel. And, naturally, our competitors are having a field day with this.

Everyone is entitled to an opinion on development. But, I don't think there is anyone who would like to see the currently robust and flourishing business that supports so many employees and vendors on the North Shore be so seriously jeopardized. The resort pumps more than $20 million into the North Shore community in wages and benefits alone annually, plus an additional $18 million in purchased goods and services. We also host two major televised golf tournaments annually that provide destination exposure and more than $100,000 to North Shore charities through Friends of Hawai'i Charities.

We believe the unexpected announcement, made without the benefit of conferring with the resort's owners, has placed the primary economic engine on the North Shore in a potentially perilous position. We hope that the initial political "glow" generated by this announcement will be mitigated by reasoned conversations that will keep in mind what is at stake among those who depend on us for a living and for the economic vitality we bring to our community on the North Shore.

This is not only about desired conservation. It's about jobs. It's about couples deciding to get married. It's about parents deciding to have a child. It's about not being afraid to buy a new car or move to a larger home. It's about many things that matter to a "quiet majority" of people on the North Shore and beyond.

Bob Boyle is vice president and general manager of Turtle Bay Resort.