Business Monday: Breathing life back into Kona Bay Hotel once known as Uncle Billy’s

Behind a chain-link fence off touristy Ali‘i Drive, the once iconic Kona Bay Hotel that also is known as Uncle Billy’s has sat empty for four years. But that will soon change.

On Tuesday, the hotel site will be blessed for the start of a renovation to turn it into a Hampton Inn by Hilton. Sandy Shapery is the largest partner in the ownership, which includes 12th & A Hotel Partners.

Shapery said it has been a long haul to get to his point. In January 2022, Shapery Enterprises purchased the property on 2.06 acres for $21 million.

Historic restoration projects are a specialty of the San Diego-based real estate development company. Shapery said he intends to refurbish, not rebuild, the iconic hotel, “to bring back that old historical vibe.”

“I’d like to recreate what it was like in Hawai‘i 50 or 60 years ago where you think of tiki torches, grass skirts and Mai Tais,” Shapery said.

The 123-room hotel was built in 1963. It was acquired by the Kimi family in the 1970s. It closed during the COVID-19 pandemic in 2020.

The cost of the renovation went from an estimated $25 million in 2022 to a current price tag of $30 million, which includes new furniture. The floor plans will remain the same.

Shapery said some of the rooms had asbestos in the drywall, resulting in having to tear down and replace walls.

“Everything is brand new but identical to what it was,” Shapery said. “For me, it was real important to keep as much of the original from a design standpoint.”

Shapery thought renovation of the hotel would have been done two years ago. With Hawai‘i County regulations requiring approved updated plans, no matter how small the change, it set the work back, he said.

“We had 40 or 50 things we discovered along the way that resulted in changes,” Shapery said.

Construction has been on hold after builders ripped down a wall of the pavilion. This forced them to provide a new plan to the county building department, which has to be review and approve it before work can continue.

Paul Gothberg, project superintendent with Honolulu Builders, is leading the hotel’s renovations.

“Right now I have three floors ready to close walls, but I can’t because we slipped in a sheet at the last minute, a drawing,” said Gothberg, who joined the project in March.

But Gothberg said he feels the excitement and anticipation the community has for the hotel to be a hotel again.

“The pressure is on me to get it done,” he said. “Everyone wants to know what’s going on. I want it to be perfect.”

The rooms throughout the 4-story semi-circle structure are framed and awaiting new walls. Gothberg said the process in this project is to frame the walls, install plumbing and electrical in the walls, and then put up drywall. These steps will move forward once the plans are approved by the county.

The project is on track to be finished by July 2025, Gothberg said.

He said the owners have given strict instructions to “repair and replace.” This includes doors, walls, sliders and air conditioning. It is known as a level one construction job.

“We just bring it back down to the basic structure of the building, and we put everything right back where it was,” he said.

All the railings throughout hotel will be replaced and decorated with a Hawaiian leaf print. The wooden boardwalk sections to the rooms will be replaced with a concrete walkway. The existing elevator is being repaired and a second one will be added.

Old fixtures, furniture and piping will be replaced with new products where needed.

Before buying the hotel, Shapery said he went on TripAdvisor, a website that provides information about hotels and accommodations from around the world, to look at the comments.

“There was nothing but pictures of cockroaches in bathrooms and sinks,” Shapery said.

But this didn’t deter Shapery, because he said he knew the Kona Bay Hotel was special.

“Generations of people would go to have their senior proms there,” Shapery said.

But it led to the first step: tenting to kill termites.

Shapery is particularly excited about the 340 tiki torches that will span across the property. While the original torches burned kerosene or gas, he decided to design an electric torch to keep the iconic feel but be environmentally friendly.

Shapery not only wants the hotel to retain its 1960s Hawai‘i vibe, but also to be accessible, which is why he partnered with Hampton Inn by Hilton.

“We wanted the Hampton brand for the affordability,” Shapery said. “We wanted to bring something that’s going to rejuvenate downtown Kona and bring life back to the area.”

While the Hilton partnership is ideal for the project, Shapery said it came with its own challenges as every Hampton Inn by Hilton is required to have heating. Shapery said Hilton insisted that the Kona Bay Hotel have heat.

“We compromised and had to put in an electric fireplace in all the rooms,” Shapery said, adding the amenity puts out as much heat as a hair dryer.

The gutted pavilion area will become home to the Trader Vic’s Mai Tai Bar. The empty pool next to the pavilion, with the spray-painted word “bench” scrawled along its side walls, will be restored and will be about 4 feet deep.

Walking through the pavilion space were sections of exposed piping and framing. Gothberg said the biggest challenge in getting the project underway was finding enough labor.

“Once we navigated through that, it was just regular construction,” Gothberg said. “The only difficulty is working within the structure of something that was built in [1963].”