Anyone interested in buying 203 condominium units being foreclosed upon in the Ilikai hotel will have to pony up at least $35 million.

That was the price floor established yesterday by lender iStar Financial, which is foreclosing on local developer Brian Anderson after he failed to renovate the Ilikai and resell units he bought in the iconic Waikiki building almost three years ago.

IStar was the only bidder at a preliminary auction of the property held yesterday outside First Circuit Court by commissioner George Van Buren.

The bid by iStar equates to $172,414 per unit, though the units aren't being sold individually.

IStar also bid $15 million for 16 commercial units at the hotel that include the front desk, restaurant space, retail space, office space, parking and some small meeting rooms.

A confirmation hearing before a judge, which is expected in the next 30 days or so, will allow anyone willing to bid 5 percent over iStar's bids to potentially acquire the property.

Van Buren said that from the inquiries he's received, he estimates there are close to 20 serious parties interested in Anderson's stake in the Ilikai.

A new owner would end months of uncertainty surrounding the popular but struggling property that was built in 1964 by local businessman Chinn Ho as part residential condominium, part hotel, and attained pop-culture icon status as part of the opening scenes of the long-running TV series "Hawaii Five-0."

It is often the case that no one except the mortgage holder bids at preliminary auctions, like the one held yesterday, when the value of the property is significantly below what the lender is owed.

At the confirmation hearing, another auction will be held starting at $36.75 million for the residential units and $15.75 million for the commercial units, which is 5 percent more than what iStar bid yesterday. It's up to a judge to approve a high bid. Also, iStar if it wanted to acquire the property could raise its bid up to the amount it is owed from Anderson.

According to the foreclosure lawsuit filed by iStar, the lender was owed about $72.7 million at the end of October on loans covering the residential and commercial pieces of the Ilikai owned by Anderson.

Anderson, through affiliates of his development firm Anekona, bought 343 hotel units in the main Y-shaped tower, commercial space and 360 hotel rooms in the connected Yacht Harbor Tower building in July 2006 for $218 million.

The developer simultaneously sold the Yacht Harbor Tower to an affiliate of San Diego-based eRealty Cos. for about $80 million. That property was shuttered and remains closed.

Anderson's plan was to focus on the main tower and sell 343 hotel rooms as condotel units while spending $40 million to restore some luster to the Ilikai and make it an upscale hotel with higher room rates.

However, executing the plan was troubled by several moves, including Anderson forcing out longtime businesses, cutting off access to the main pool and restricting parking and storage.

Those moves angered many longtime condo owners in the roughly 1,000-unit main tower, and the ill will and lack of trust toward Anderson led to a rejection of the renovation plan.

A crash in Hawai'i's condotel market, a mortgage industry meltdown, the downturn in tourism and a lawsuit filed by some investors in the project also contributed to the demise of Anderson's plan after 140 unit sales.

Court filings show Anderson defaulted on loan interest payments last April, and iStar sued to foreclose in August.