Greg Kratz, Deseret News
A view of the ocean and the island of Lanai as seen from the beach area outside the Marriott Maui Ocean Club resort in Lahaina, Hawaii, Saturday morning.

HONOLULU — The sale of Hawaii's smallest inhabited island is imminent, and local leaders are anticipating what new ownership could mean for the island's some 3,200 residents.

A potential buyer of Lanai, in Maui County, was revealed to Gov. Neil Abercrombie and the county's mayor at a meeting last week with representatives from landowner Castle & Cooke Inc. Self-made billionaire David Murdock's Castle & Cooke owns 98 percent of island's 141 square miles.

"I was told they're in serious negotiations," Mayor Alan Arakawa told The Associated Press on Tuesday. "There's a possibility Lanai may be sold in a week or so."

He said he's sworn to secrecy about the buyer's identity. But any buyer would have to have deep pockets.

The asking price is reportedly between $500 million and $600 million, the Maui News reported. Castle & Cooke did not immediately comment Tuesday.

In 2000, Murdock bought out fellow Castle & Cooke shareholders for nearly $700 million and took the company private.

The island is still known as the "pineapple island," even though Murdock has closed its pineapple operations to make way for luxury resort and home development. The island boasts unspoiled charm with 30 miles of paved roads, 400 miles of unpaved roads and no stoplights.

Arakawa said the sale could again alter the economic structure of the island and its residents, who have seen the passing of Lanai's longtime pineapple industry and now rely on employment at resorts, golf courses and other businesses. Aside from the hotels, the island's infrastructure is at stake, he noted.

"I have to be able to feel out the perspective new owner and what their intentions are," Arakawa said.

He said he's confident that Murdock's love for the island will mean ensuring the new owner is a good steward, evidenced by Arakawa being regularly updated on sale developments.

"They will consult with us because they know it's critical for the survival of the island," he said. "I know that Mr. Murdock really likes the island. A lot of this has been sentimental for him. He's put a lot of money into the island."

But he understands Murdock's desire to sell. The Honolulu Star-Advertiser reported the island produced annual losses of roughly $20 million to $30 million from 2006 to 2010.