If you are writing an offer on a Kapalua condo this summer, the first question is no longer view, floor, or renovation year. It is which of three regulatory futures the building sits in, because after December 15, 2025, Kapalua's apartment-zoned condos stopped being a single asset class.
Bill 9, now Ordinance 5909, phases out transient vacation rentals in Maui's apartment districts. Bill 9 establishes geographic amortization periods. West Maui properties must cease STR operations by January 1, 2029. Properties in the rest of the county (primarily South Maui) must stop by January 1, 2031. Kapalua sits in the West Maui window. That gives an owner at an affected building a rental runway of roughly two and a half years from the day you close, and it gives a buyer a very specific question to ask before wiring earnest money: is this unit's building going to end up hotel-zoned, or not.
The Three Regulatory Futures in One Resort
Kapalua contains five condo projects that historically produced nightly rental income. Bill 9 and Bill 88 do not treat them the same way.
| Project | Current zoning | Bill 9 status | On TIG Exhibit 2? | Practical rental future |
|---|---|---|---|---|
| Ritz-Carlton Residences | Hotel/Resort | Unaffected | N/A | Nightly rental preserved |
| Montage Residences | Hotel/Resort | Unaffected | N/A | Nightly rental preserved |
| Kapalua Bay Villas | Apartment (Minatoya) | Phase-out by Jan 1, 2029 unless rezoned | Yes | Candidate for H-3/H-4 rezoning |
| Kapalua Ridge Villas | Apartment (Minatoya) | Phase-out by Jan 1, 2029 unless rezoned | No | AOAO must self-initiate a rezoning |
| Kapalua Golf Villas | Apartment (Minatoya) | Phase-out by Jan 1, 2029 unless rezoned | No | AOAO must self-initiate a rezoning |
If this legislation is passed, the two hotel/resort condos that would allow short-term rentals are the Montage Residences and the Ritz Carlton Residences. Everything else in the Kapalua resort with a nightly rental history runs through the apartment-district column, and that column is where the interesting friction lives.
Why Exhibit 2 Is the Number That Matters
The apartment-district condos share a common inheritance. They are all on the Minatoya List, the county's record of apartment-zoned projects that were grandfathered for short-term rental under a 2001 legal opinion. Bill 9 revokes that vested use on the West Maui timeline. Bill 88, passed 7-2 on June 19, 2026 and effective as Ordinance 6008 on June 22, does not save any building on its own. Housing and Land Use Committee Chair Nohelani Uʻu-Hodgins, who introduced the motion to pass Bill 88, stressed that the measure does not rezone any properties on its own. "This bill only establishes the district and it does not rezone any properties," Uʻu-Hodgins said. "Rezoning will have to happen separately."
What Bill 88 does is create two new hotel categories, H-3 and H-4, that a Minatoya building can apply into. The odds of a successful application depend heavily on whether the project made the Temporary Investigative Group's Exhibit 2. That report, dated October 14, 2025, is the council's working shortlist of buildings the TIG considered better suited to remain nightly rentals than to convert to long-term housing.
For Kapalua, the Exhibit 2 line item everyone remembers is Kapalua Bay Villas. Kahana Outrigger is the only condo of the three that made it to the TIG Exhibit 2 List. Three of the Kapalua condo developments that currently allow short-term rentals are zoned apartment. As things stand, they need to phase out vacation rentals by January 1, 2029. It was a surprise to many that only Kapalua Bay Villas made it onto the TIG Exhibit 2 List. The Ridge and Golf Villas were the only condos on the Minatoya list located in one of Maui's three resort areas excluded from Exhibit 2.
That single omission is the thesis of this post. Two Kapalua projects, sitting inside one of the county's three official resort areas, are the anomaly of the entire TIG process. Every other apartment-zoned Minatoya building in a resort core made the list. Ridge Villas and Golf Villas did not. Buyers evaluating either building need to price that anomaly directly, because the AOAO now has to self-initiate a rezoning against an Exhibit 2 that used its absence as a signal.
Where the Rezoning Machinery Actually Stands
Passing Bill 88 was step one. Step two is a separate rezoning application for every building that wants out of the phase-out. That process began in early July 2026 with two council resolutions.
Resolution 26-110 covers properties with timeshare, leasehold or other characteristics, including Hono Kai and Milowai-Māʻalaea in Māʻalaea, Maui Sunset and Maui Hill in Kīhei, and Kahana Outrigger, Hale Mahina Beach Resort and Kāʻanapali Royal in West Maui. Resolution 26-111 covers seven properties the county says already operate like hotels, including Wailea Ekahi I, II and III, Wailea Ekolu, the Palms at Wailea, Papakea and Maui Eldorado. No Kapalua project appears in either first-wave resolution. Kapalua Bay Villas is still on the master pipeline. Ridge and Golf Villas are not.
For a buyer, that means the rezoning clock at any Kapalua apartment-zoned condo has not yet started. The AOAO board's minutes are now the operative document. Has the association voted to pursue H-3 or H-4 zoning? Has it commissioned the required studies? Has it budgeted for them? At the June 19 final reading of Bill 88, property owner TJ Victorine testified that land-use planners have quoted him $200,000 to $500,000 per property to prepare the studies currently required. "This is prohibitively expensive for most properties, including our own, and effectively nullifies the intent of Bill 88," he said. That is the number a buyer at Ridge or Golf Villas should ask an AOAO president about before removing contingencies.
A Buyer's Diligence Checklist for a Kapalua Condo in 2026
- Confirm current zoning on the tax map key. Hotel/Resort zoning at Ritz-Carlton or Montage is a different asset than A-1 or A-2 at Bay Villas, Ridge, or Golf Villas. The zoning designation is the single largest input to your post-2028 income model.
- Check the building's Exhibit 2 status. Exhibit 2 is a signal about likelihood, not a guarantee. Bay Villas is on it. Ridge and Golf Villas are not.
- Read the AOAO board minutes for the last twelve months. You are looking for a formal vote to apply for H-3 or H-4 rezoning, a budget line for the land-use study, and any special-assessment discussion tied to the application.
- Ask whether the association has retained a land-use planner. Without an engagement, the two-and-a-half-year window until January 1, 2029 is functionally shorter than it looks.
- Price the unit twice. Once as a nightly rental through December 31, 2028, and once as a long-term residential or 30-plus-day rental asset from January 1, 2029 forward. The gap between those two numbers is the risk you are being paid to take, or not.
- Read the disclosures for pending litigation. Two lawsuits are active. Malter v. Maui County, filed December 19, 2025, represents owners at the Ka'anapali Royal condominium complex, luxury units on the 16th fairway of the Ka'anapali Golf Course. Lynam v. County of Maui, filed December 22, seeks class-action status on behalf of all 7,000 Minatoya List property owners. Both cases argue Bill 9 constitutes an unconstitutional taking under Article 1, Section 20 of the Hawaii Constitution. No injunction has been issued.
What the Price Sheet Is Already Telling You
The market has begun pricing this bifurcation, and not gently. One West Maui broker's summary in mid-2026 was blunt: Even ban-safe, hotel-zoned condos are down 20–30% from their recent peak. If the ban-safe cohort is off that much, an apartment-zoned Kapalua unit without Exhibit 2 cover is contending with a wider spread. That spread is the buyer's opportunity and the seller's problem, and it is why the same floor plan at Bay Villas versus Ridge Villas should not be trading at the same square-foot number in the second half of 2026.
The point is not that Ridge or Golf Villas are bad buys. They are perfectly good real estate at the right basis. The point is that the underwriting has changed. The building's regulatory position has moved from a footnote to the top of the pro forma, and any Kapalua condo purchase where the rental income assumption ignores Exhibit 2, the AOAO's rezoning posture, and the January 1, 2029 date is being underwritten on a market that no longer exists.
FAQ
Does Bill 88 automatically save Kapalua Bay Villas? No. Bill 88 gives certain apartment-zoned short-term rentals a pathway to keep operating as the county phases out nearly half of Maui's vacation rentals under Bill 9. Bill 88 does not automatically rezone any property, each condo community must still apply. Bay Villas has a favorable position on the TIG's shortlist, not a granted rezoning.
Can Kapalua Ridge Villas or Golf Villas still apply for H-3 or H-4 zoning even though they are not on Exhibit 2? Yes. Any Minatoya-listed apartment-zoned building can file a rezoning application under Ordinance 6008. Absence from Exhibit 2 is a headwind, not a bar. The practical questions are cost, timeline against the January 1, 2029 phase-out, and whether the AOAO has the votes and the reserves to pursue it.
What about a Kapalua condo that has never been rented nightly? The phase-out changes what the building is allowed to do, not what any given owner chooses to do. If you plan to owner-occupy or rent long-term, Bill 9 has minimal direct effect on your use, though it still affects resale by shaping who your future buyer is.
Bill 9 and Bill 88 have redrawn the Kapalua condo map in a way that a portal listing cannot show you. If you are weighing a specific unit and want a plain read on where its building sits in the pipeline, the AOAO's current posture, and what that means for your basis, The Marchello Team works these files every week. Start Your West Maui Home Search and let us walk the numbers with you.