Maui Land & Pineapple Co. plans to begin selling 56 resort condominiums fronting Kapalua Bay later this month for about $4 million to $7 million each as part of redeveloping the Kapalua Bay Hotel.

The three-bedroom units are among 146 condos slated to replace the 196-room hotel as part of a $300 million anchor investment expected to rejuvenate Kapalua Resort in West Maui.

Dubbed The Residences at Kapalua Bay, the 56 condos represent some of the priciest resort homes on Maui, rivaling condos at the more upscale Wailea Resort in South Maui where prices can run $7 million or $8 million.

"This is their last big opportunity to do something on the beach, so they're going to shoot for the stars," said local housing market analyst Ricky Cassiday.

The Residences at Kapalua Bay is one of three condo projects to be developed by Maui Land & Pine in partnership with Ritz-Carlton Hotel Co. and Exclusive Resorts in place of the oceanfront hotel on 24 acres.

Ritz-Carlton, an affiliate of Marriott International, plans 62 two- and three-bedroom condos to be marketed and sold as fractional vacation home ownership, essentially a longer-term version of time-share, under the Ritz-Carlton Club brand.

The Ritz-Carlton Club units are scheduled to be sold starting in July. The company estimates prices will be close to $500,000 plus about $15,000 in annual maintenance and service fees for 21 days of use a year. The balance of the year, 113 days, is retained by Ritz-Carlton mostly for use by members for an additional cost.

Ritz-Carlton said its club is the first fractional property ownership condo project in Hawai'i, as opposed to traditional time-share property sold in seven-day blocks.

Unlike the typical time-share arrangement, Ritz-Carlton Club intervals cannot be traded with time-share owners outside the Ritz-Carlton Club or for other items like hotel stays or air travel.

Ritz-Carlton Club members own their interests in the condos, which they can pass to others or sell. Owners also can trade with other members in the club distinguished by its service and amenities.

The Ritz-Carlton Club was established in 1999 and has about 2,500 members at four projects — two Colorado ski resorts, a golf resort in Florida and a beachfront resort in the U.S. Virgin Islands. Two other projects are planned in San Francisco and Miami Beach, Fla.

Robert Phillips, senior vice president of business development for Ritz-Carlton Club, said Hawai'i, with an emphasis on Maui, was consistently the most requested location club members wanted to be able to visit.

"This is really a fulfillment of one of the key areas we've wanted to go with the company," he said.

Phillips estimated it could take four or five years for the Kapalua project to sell out.

The third element in the Kapalua Bay project is 28 condos to be owned by Exclusive Resorts, which has about 1,800 members who pay a one-time fee and annual dues for use of about 300 luxury residences around the world.

All three components of the Kapalua Bay condos, spread among nine buildings three to six stories high, are projected to be complete in late 2008.

The hotel is scheduled to be closed on April 7 and razed to make way for the new project. A spa, recreational area, bar and grill, lagoon-style pool and new retail complex are also part of the redevelopment plan.

About 271 hotel jobs will be lost during construction, and replaced by about 263 new jobs, according to Marriott.

David Cole, Maui Land & Pine president and CEO, said the luxury condo project was part of a strategy to have more with less by way of attracting fewer visitors who spend more.

"Kapalua Bay will offer a new kind of resort experience that will place it among the world's premier destinations," he said.

The Kapalua Bay Hotel was developed by a Maui Land & Pine subsidiary, and opened in 1978 as one of the state's finest hotels. A partnership of Japan and South Korea investors bought the hotel but not the land under it in 1990 for $102 million, then lost the hotel to an investment banking firm after filing for bankruptcy in 1995.

In 2004, Maui Land & Pine repurchased the hotel with Marriott and Exclusive Resorts for about $48 million.

Of the three partners, Maui Land & Pine is the majority partner with a 51 percent stake in the project. Marriott has a roughly 33 percent stake, with Exclusive Resorts at about 16 percent.

Kapalua Resort covers about 1,650 acres and also includes the Ritz-Carlton Kapalua hotel, three golf courses and 10 residential subdivisions.

Reach Andrew Gomes at agomes@honoluluadvertiser.com.