Final phase of demolition for famous Hawaii hotel is just first step

HONOLULU (KHON2) — The former Uncle Billy’s Hilo Bay Hotel site is getting a fresh start as demolition moves into its final phase.

Local leaders weighed in on what it means for the community.

The Waiakea Peninsula in Hilo is transforming as the final phase of demolition at the former Uncle Billy’s Hilo Bay Hotel site began this week. The $4.7 million project will clear underground utilities, remove contaminated soil and prepare the site for future use by 2026.

Community leaders see it as a chance to reimagine a once-iconic spot.

“Where it really became a magnet for that underbelly of community. And so I’ve heard from, you know, people who’ve had jobs there. That was their first job, to watch it kind of have that backslide, really, you know, just left a bad taste in their mouth,” said Rep. Sue Keohokapu-Lee Loy.

Hilo’s representative reflected on Uncle Billy’s decline from a tourism and local music hub to a condemned eyesore plagued by crime.

The focus is on what’s next, however, and Mayor Kimo Alameda envisioned a community-driven space.

“Or it could be a parking lot and maybe even a pavilion to host, weddings, parties, birthdays. It’s, possibilities are unlimited. And it’s super inspiring to finally, look at this place as contributing to the community instead of being an eyesore,” Hawaii County’s mayor said.

Alameda emphasized the potential of the site and postulated the idea of creating a public park or open space — but he is clear that locals will come first in its planning.

“What’s good for our local families will be good for our tourists. You know, so. But ultimately, you know, I’m a local guy, so, you know, I’d like to see it be used with, with locals in mind,” Alameda said.

The Hawaii Community Development Authority is leading the broader Waiakea Peninsula revitalization, Hilo’s representative sees the final phase of demolition as a turning point.

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“It’s not the last stage. It’s the first step for a new, vibrant and thriving Hawai’i island,” Keohokapu-Lee Loy said.