Maybe May for Maui: Waterpark closes, promises to re-open

PERKINS TWP. Less than six months after opening, Maui Sands Resort closed its doors Thursday while t
susanmcmillan
May 24, 2010

 

PERKINS TWP.

Less than six months after opening, Maui Sands Resort closed its doors Thursday while the indoor waterpark's owner plans to file for Chapter 11 bankruptcy.

The resort laid off most of its 100 or so employees, and guests who had reservations for Thursday night had to find other accommodations.

Spokeswoman Lexi Robinson said Maui Sands will remain closed until May while construction finishes on a portion of the property.

"We opened too soon," Robinson said.

The Family Suites Hotel and waterpark were complete when the resort opened in June, but the Hawaiian Cabana Village, scheduled to open in the fall, is not in operation.

"Basically, we were having financing delays because that portion of the property had not yet been finished," Robinson said. "Those rooms sit empty, and they were expected (to be) revenue."

Maui Sands has struggled financially since its start. By September, at least 17 contractors and subcontractors had filed nearly $4 million in liens against the resort for unpaid labor and materials, according to county records.

Robinson said she didn't know if any of the debts had been paid. The county recorder's office was closed Friday.

Under Chapter 11, a company reorganizes under supervision from a federal bankruptcy court.

The court can grant the company complete or partial relief from its debts and contracts.

A&M Tiling, Westlake, filed liens totaling about $116,000. Owner Melissa Vasquez said now that Maui Sands owner Scott Emerson is filing for bankruptcy, she doesn't expect to receive the entire amount she's owed.

"I'm assuming I'll get paid something, but I don't think I'll be able to break even with it," she said. "I thought this was going to be my big break, and it's going to end up breaking me."

Vasquez said she had been in contact with Maui Sands managers in recent weeks, trying to set up a meeting. She said they told her a new investor was coming in, and assured her there would be no bankruptcy filing.

"I don't understand why they hired me if they didn't have the money to pay," she said.

Meanwhile, the resort has pared its staff down from about 100 to seven people who will handle reservations and marketing. None of the employees received their paychecks this week.

Ryan Mygrant, who worked as a bellhop and at the front desk, said employees were told their checks would be ready at 1 p.m. Wednesday. Managers pushed it back 3 p.m. Wednesday, then to Friday, then to "sometime in the next couple of weeks."

Mygrant said employees on Thursday "literally were crying when they left work because they could not provide Thanksgiving dinner for their families."

Robinson said the bankruptcy court will determine how and when to pay employees, and the resort's laid-off employees will receive "special consideration" when Maui Sands resumes hiring.

Mygrant said he would not consider going back.

Robinson said Emerson will seek a way to finance the remaining construction through the bankruptcy process. Emerson will also talk with the contractors about returning to the project, she said.

"He'll be working with everyone on a case-by-case basis," she said. "It's an unfortunate situation, but it's one he's working through."

The resort's closing has also disrupted families' travel plans. Connie, a North Ridgeville resident who declined to give her full name, said she and some friends reserved five rooms, planning the stay as a Christmas gift for their children.

The resort is offering people with canceled reservations a two-for-one credit for next year, Robinson said, rather than a refund because the company charges up front.

"That doesn't do us any good for Christmas now," Connie said. "I'm out about $180."

Even if the resort's closing hadn't spoiled her Christmas plans, Connie said, the value of the credits would be questionable.

"If they re-open under a bankruptcy it could be under a different name," she said. "Who knows if they'll honor it? Who knows if they'll re-open?"