Waikiki Edition saga continues: M Waikiki files for bankruptcy
eTN called THE EDITION hotel at 5.45pm and the phone were answered with "hello" . The phone operator claims to be working for the Modern and for Aqua hotels. However he said this may change.
eTN called THE EDITION hotel at 5.45pm and the phone were answered with “hello” . The phone operator claims to be working for the Modern and for Aqua hotels. However he said this may change. Surprisingly a New York court ordered Aqua today to return management to Marriott at 2pm Hawaii time. The phone operator unable to give his name also stated: “The management is still working out who is actually taking control of the property. He stated to be working for Aqua hotels.
M Waikiki LLC, a hotel investment company, today announced that is has filed for Chapter 11 bankruptcy protection. The filing allows the company to reorganize in an effort to protect its investment in The MODERN Honolulu, a 353-room luxury hotel. M just yesterday signed with Aqua Resort in an attempt to take over the EDITION Hotel managed by Marriott. eTN reported in details.
The filing follows a court decision this morning granting a temporary restraining order to allow Marriott International Inc. (“Marriott”) to resume its operation of the property. The Chapter 11 filing now allows M Waikiki (“Owner”) to reaffirm the termination of the management agreement with Marriott and continue to employ new management at the property. M Waikiki LLC had installed new management this weekend at The MODERN Honolulu, formerly known as the Waikiki Edition.
“We respectfully disagree with today’s court decision and remain confident that the Owner acted within its rights terminating its contract with Marriott,” said William A. Brewer III, partner at Bickel & Brewer and lead counsel for Owner. “In any event, the Owner has filed for bankruptcy protection, which will permit it to continue the operation of the hotel under its present management with Modern Management Services.”
Modern Management Services was installed as the manager at the property on August 28, 2011. The hotel was renamed, guests were advised, and hundreds of hotel staff members were offered employment. New management remains in place.
Today’s ruling and reorganization announcement do not affect Owner’s claims against Marriott, pursuant to which Owner seeks tens of millions of dollars in damages.
“In our view, filing for bankruptcy protection is the only prudent option for protecting our investment in this asset,” said Damian McKinney, principal of M Waikiki LLC. “We look forward to reorganizing as a new corporate entity, continuing the employment of a new management company, and making this a leading lifestyle hotel for guests and employees.”
It remains to be seen what the next move is between Marriott and Aqua to gain full control of the resort. Guests paying several hundred dollars a night are caught in the middle. Who knows if they receive Marriott reward points for their stay?