BY MALIA ZIMMERMAN – Hawaii Reporter has learned that the new management company of the hotel once known as the Waikiki Edition has had its spa and liquor licenses suspended – at least temporarily.

Early Sunday morning, the owners of the 335-room luxury hotel, M Waikiki LLC, threw out the Marriott International management company, changed the locks and renamed the hotel to The MODERN Honolulu.

Later that morning, guests and hotel staff were informed by the new management firm, Modern Management Services, an affiliate of Aqua Hotels & Resorts, that its management is taking charge of the elite harbor front property.

The owners sued Marriott International in a New York court in May saying they are losing tens of millions of dollars because its management isn’t up to par.

M Waikiki also filed for bankruptcy this week after Marriott International was granted a temporary restraining order by a New York court against the owners. The bankruptcy allowed M Waikiki LLC to ignore the restraining order, keep its new management company and reorganize its debt.

But the transition hasn’t been smooth.

Spa workers are off the job until the hotel gets a new spa license.

City regulations say no alcohol can be until a new license is issued under the new management name.

M Waikiki LLC Spokesperson Russell Pang said the hotel is addressing the licensing problem.

He added: “The hotel is in the process of obtaining new licenses under the new management company.  The spa employees have been offered the opportunity to reapply. The MODERN concierges are assisting guests with other comparable spa alternatives in the interim. There are no other permits that would need to be renewed.”

There seems to be a bit of confusion however among staff.

Employees told Hawaii Reporter that the City Liquor Commission informed them that their required server cards are no longer valid as of Thursday morning and therefore they could not serve alcohol legally without being fined.

Last night, a Hawaii Reporter intern was able to obtain a Mai Tai for $11 in the hotel lobby bar. The bartender told our intern that the company had not lost its license.

Meanwhile , KITV reports that hotel is giving away alcoholic drinks earlier in the evening.

Employees said hotel officials met with the city liquor commission at 4:30 p.m. yesterday to resolve the issue.

(Update: Spokesperson Russell Pang said on Friday that there was confusion over the issue because the license to serve alcohol was granted temporarily at 7:30 p.m. and before that, drinks were given away. Afterward the hotel went back to charging for drinks.)

But while the liquor and spa licensing problems in the luxury hotel with five bars, a nightclub and a restaurant is problematic, this isn’t the only trouble the owners and new management company face.

Employees are in turmoil, largely because of the shocking way they say the transition was handled. Aqua Hotels took over the property at 2:30 a.m. on Sunday. Employees were all gathered in a large ballroom to hear the news.

“It was a very hostile, aggressive take over. It was very scary. It felt like a coup,” said one employee. “We were told to give them our Social Security numbers and personal information… all this to people we don’t know.”

Another employee said “I was told if I didn’t go to the ballroom that Sunday, I would be escorted off property. I’ve talked to some other employees on property and they said many of our personnel files marked “EDITION confidential and proprietary” have been rummaged through by Aqua.”

So far, 220 of 275 employees have been rehired.

A Facebook page has been started titled “Save the Waikiki Edition” in which many residents and guests are showing their support  for the Edition and Marriott International.

However, some are pleased with Aqua Management gaining control of the property and believe that Marriott International was not doing their job in promising a unique experience to guests.

“I stayed at the Edition for two weeks when I first moved to Hawaii. Our room was not ready by check-in time, but four hours later they finally told us we could go to our rooms. The whole experience was a nightmare and there were a myriad of problems. I feel that perhaps the hotel will thrive under Aqua,” said former guest John Marnell.

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