The state Department of Land and Natural Resources wants to hire an architect to help it envision what redevelopment could look like on three Banyan Drive properties.
The leases for the properties, which include Uncle Billy’s Hilo Bay Hotel, Country Club Condo Hotel and Reed’s Bay Resort Hotel, each expire next year in March.
Currently, DLNR is in the process of assessing what to do with the properties going forward.
According to a staff memo to the state Board of Land and Natural Resources, the architect would be responsible for illustrating various options for redevelopment. That would include impacts of shoreline setbacks and other regulations not in place when the existing buildings were finished.
“In turn, this information will assist staff in making a recommendation to the board on the best competitive process for selecting lessees of the properties,” DLNR Assistant Administrator Kevin Moore wrote.
The board will consider the request to hire an architect as a consultant at its Friday meeting.
DLNR also has a planning consultant addressing issues related to hotel demand in the area, effects of sea level rise, and lifespan of existing structures on the properties.
According to Moore, preliminary results of that work show the buildings have between eight and 15 years of remaining life.
“Accordingly, any future use of the properties will likely involve major renovations to existing buildings, or demolition of these buildings and construction of new ones,” he wrote to the board.
Gordon Heit, DLNR’s Hawaii Island district land agent, said the department wants to make sure it does the “right thing” with the properties.
“Basically, we feel Banyan Drive does have a major impact on the economy of East Hawaii. We want to make sure anything we do is in the best interest for the area,” he said.
But the current process is leaving lease holders in limbo, and Heit couldn’t say whether the department will be able to sign new leases by the expiration date.
“I really can’t say at this point,” he said.
“The statutes do provide for one-year holdovers on general leases.”
Aaron Whiting, Uncle Billy’s Hilo Bay Hotel manager, told the Tribune-Herald in April he is not accepting reservations after Jan. 31 due to the uncertainty over the land lease.
He also said then he is interested in seeking a new lease, but noted DLNR had not given lease holders direction on that process. Whiting couldn’t be reached for additional comment late Monday afternoon.
Donald Inouye, Reed’s Bay Resort Hotel president, said in April he wants a lease extension. He said he submitted a request for an extension that involves renovations to the building.
A woman who answered the phone for Herbert Arata, the master leaseholder for the Country Club, said he has no comment.
Email Tom Callis at tcallis@hawaii tribune-herald.com.