HILO — Kalani Oceanside Retreat in lower Puna, which has remained closed following the eruption of Kilauea volcano last May, is for sale — and at least one creditor is crying foul.
Molly Masaoka, who owns Yoga Centered Studio and Boutique in Hilo, said she hasn’t been returned an $18,000 deposit she and a partner had plunked down for rental space at the 19-acre retreat, also known as Kalani Honua. Masaoka added she knows of others facing the same predicament.
“We’ve been doing teacher training down there for about six years, two or three times a year,” Masaoka said. “We brought in probably a million, two million dollars for them over the past five or six years, you know. We put down a deposit to reserve (space) for future teacher training. … When the lava started, they sent out this email that was, like, ‘Oh, we’re closed indefinitely because of the lava.’ … No talk of, like, refunding anyone’s money.”
The agriculturally zoned 19-acre parcel with conference center, kitchen, dining lanai, office and gift-crafts shop, three staff rooms, a pool and other amenities is listed online for sale for $2 million on the personal website of Richard Koob, Kalani’s founder. The contact is Elizabeth Koob, a Yonkers, N.Y.-based lawyer and Koob’s sister. The Tribune-Herald was unable to find any listings by local real estate companies for the property.
The county’s Real Property Tax Office website lists the owner of the property as Kalani Honua Inc., a domestic nonprofit organization. The state Department of Commerce and Consumer Affairs website lists Tonya Ozone as president of Kalani Honua Inc., with Rebecca Marshall as secretary, Craig Torchia as treasurer, and Lynda Saffery, Tam Hunt, Larry Reitzer, Janet Elizabeth Taylor and Randy Franklin Niklason as directors.
“The nonprofit owns it, but we have a mortgage to (the Koobs),” Ozone said. “We haven’t paid the mortgage in a year because we haven’t had the funds. They’re not wanting to foreclose because that’s a long, involved process for them. We don’t want to do bankruptcy because we want to satisfy all of the debts we owe. So we are actively pursuing the sale of the property.”
The last sales transaction listed on the county’s property tax website for the property is a $10 warranty deed with a sale date of May 21, 2009, and a recording date of Nov. 19, 2010. The seller is Koob Hawaii Enterprise LP, a domestic limited partnership with Kalani Kai Eco Village Inc. as the only partner listed. Kalani Kai Eco Village is a domestic for-profit corporation. Its listed officers are: Elizabeth L. Koob, president and director; Stephen J. Koob, vice president; Mary Jane Koob, treasurer and director; Richard T. Koob, secretary and director; and Daniel J. Koob, director.
Ozone said the actual mortgage note is for $1.6 million over 30 years. She said the $10 is “for a lease, which I have never understood, nor has anyone ever explained it to my satisfaction.” A Realtor consulted by the Tribune-Herald said a warranty deed for $10 “and other considerations” is a common practice.
According to Ozone, there have been “several inquiries” on the property, which has a total market value of $2,375,800, according to the county’s property tax website.
Ozone acknowledged Kalani’s creditors include Masaoka and others who paid deposits for use of facilities for future retreats.
“Molly’s one of probably, gosh, a hundred people or so that we owe money to. We owe close to $200,000 to retreats,” she said. “Our intent is to pay that money. But until we get the funds, we’re not able to do that.”
Asked why retreat deposits weren’t put into a trust account of the type property managers use to keep tenant deposits and rent payments separate from operating capital, Ozone replied, “That’s a good question.”
“Kalani Honua has been in business for 43 years. The way the business model was set up — which we were in the process of fixing — we would take deposits for future retreats, so we would always be running six months behind in some payments. When the lava came, it shut the business down, and we’ve never been able to recover. We’ve been closed almost a year due to the lava. We had no reserve funds, whatsoever,” she said.
