Kamehameha Schools announced Wednesday it will close the Keauhou Beach Hotel in Kailua-Kona by the end of October.
Kamehameha Schools said financial losses have been significant over the past six years, the cost of renovating or re-purposing the hotel would be prohibitive, and the overall vision has shifted away from resort operations and toward a culture and 'aina based-learning center.
Options such as selling the hotel or turning it into a time-share operation were explored.
"This hotel has been a place of rest and play for so many people in its past 40 years -- myself included," said Kamehameha Schools CEO Dee Jay Mailer. "It has employed wonderful people who have served its customers and this community well; however, times have changed. Despite the good work of many committed and talented people, financial losses at the hotel over the last six years have been substantial. To return the Keauhou Beach to possibly compete in the Kailua-Kona hotel market would take tens of millions in further investment that would be very difficult to recover."
The Keauhou Beach Hotel employs 112 full- and part-time workers. Hotel employees will get more information for the transition from their Outrigger Human Resources associates and ILWU representatives in the coming days.
Kamehameha said it may be able to keep the tennis courts and Farmer's Market open on a month-to-month basis while going through the permit process to demolish the hotel.
The Keauhou Beach Hotel is situated on lands at Kahalu'u having some of the richest cultural history in Hawaii.
Heritage sites on the Keauhou Beach Hotel property include Kapuanoni Heiau, Po'o Hawai'i, two ku'ula and the reconstructed Halau of High Chief Kuakini and King Kalakaua's Summer Cottage.