Demolition of former Uncle Billy’s in Hilo could begin by the end of this year

At a recent Hawai’i County Council meeting, Grand Naniloa Hotel general manager Scott Pauli testified that the dilapidated and dangerous property next door — the former Uncle Billy’s Hilo Bay Hotel — is a blight to the entire historic Banyan Drive.

Not only is it an eyesore to Naniloa guests, he said, but the abandoned property also compromises the safety of his employees and the community because of illicit and illegal activities that regularly occur there.

“It has to come down,” Pauli said.

And soon it will.

At the urging of Hawaiʻi County Council’s Resolution 199, Gov. Josh Green issued an emergency proclamation for the property on July 18 that mandated fast-tracking the demolition of the 148-bedroom building located on 2 acres of state-owned land along the Big Island’s Waiākea Peninsula.

“Atta boy! He believes in better for Banyan Drive,” said Councilwoman Sue Lee Loy, who represents the Banyan Drive area and introduced the resolution that sought the governor’s help.

Green issued the proclamation after the Council favorably recommended Resolution 199 but before it was approved. So on July 26, the Council adopted an amended version of the resolution that thanked Green and urged Dawn Chang, chair of the Department of Land and Natural Resources, to communicate “the critical pathway and timeline to ensure efficient implementation and coordination with the County.”

“We moved the needle and now the real work begins,” Lee Loy said.

The Hawai‘i Department of Land and Natural Resources, which has jurisdiction over the property, said demolition of the once iconic hotel is anticipated to begin by the end of the year.

The proclamation mandates urgent demolition of the abandoned buildings and restoring the site with hazard abatement to the extent allowed by available funding. It also suspends certain state and county permitting and procurement requirements, speeding up the permitting and contracting process for the project.

The exact demolition timeline is contingent upon a variety of factors to be determined after the project is awarded to a contractor and a site assessment, which includes addressing any hazardous materials, is completed.

Lee Loy continues to communicate with Chang about the next steps for the property. Lee Loy said current land use, shoreline setbacks, flood inundation areas and regulatory controls will drive much of the vision. Her best guess is that the site would be used as open space, a park or something similar.

“Personally, I’d like to see that happen,” she said. “That site needs to rest, rejuvenate and heal.”

But first, the former hotel has to be demolished. Since its permanent closure in 2017, the abandoned buildings have been a long-term headache and drain on resources for the Land Department, which has held sweeps of squatters and now stations a security guard there, and for the Hawai’i Island police and fire personnel who regularly respond to calls at the property.

Demolition is estimated to cost $13.5 million. Since 2019, the Land Department has sought funding for this work from the Hawai‘i State Legislature. It did not receive an appropriation for the project until this year — and it’s only for $8 million. However, officials think with the emergency proclamation they will be able to use the appropriated funds to timely and safely demolish the former hotel structure.

The governor’s mandates also include building a perimeter fence around the former Uncle Billy’s property — to keep out squatters and people who want to conduct illegal activities at the unsafe place.

East Hawai‘i-based Andrew’s Fencing was awarded the contract and informed the state it will begin the one month project in August.

The emergency relief period laid out in Green’s proclamation only runs through Sept. 15, but it can be extended for 60 days if necessary. Additionally, any contracts entered into during the emergency relief period can continue even after it ends.