According to the Heat Vision blog, Michael Caine is currently in final negotiations to star as the grandfather:
The script, loosely based on Jules Verne’s “The Mysterious Island,” sees Hutcherson reprising his role from the first movie and partnering with Johnson, playing his mom’s boyfriend, on a trip to a mythical island to find his missing grandfather.
Caine is the grandfather, but the part is no cameo. The role will see the actor in action mode, engaging in several chase sequences, including one involving giant bees.
The movie will shoot in Hawaii and then move to North Carolina.
-via Heat Vision