Great question....I have one doing the same the same thing!! Appreicate any help &/or why it is happening. Thanks, ruthann

You can poke a needle in the area you are concerned about. If it leaks latex its not rotted. IF no latex it has a serious problem.
Andi

I looked at it closer. The outer layer is all dried out, and separated from the layer below. The latex underneath is congealed. So it is obviously not functioning as a conductor of nutrients (also evidenced by the wrinkling above as that part of the stem dries out). It looks like the tips of each trifurcation want to form leaves.
I think I need to do a cutting! Now my question is to do it with the trifurcation intact, or cut them up into separate pieces for rooting. Each limb of the trifurcation measures ~ 5 inches, and the stem part is about 8 inches.

Besides discussing a possible solution to a potential problem, I am wondering why it may have rotted in the first place?

Plumeria is pretty much immune to most pests and diseases, with the exception of rust. Your problem doesn't sound like rust from what I can find. Below is what I would do if the tree were mine and I was unable to find the culprit.

Before you cut the problem area out of the tree, I would take a picture of it as it is now, its location or several locations on the tree. Then remove the problem areas. Wrap the section/sections in paper toweling and place in a cardboard box. Take these sections to your Universities Horticultural Sciences branch. They then could study the pest/virus/fungus thats causing the shriveling. The pest/disease/fungus may be a common problem to other trees/plants but not normally found in the Plumeria. This pest/disease/fungus may have mutated in such a way that it now infects the Plumeria. When we push the zones, we bring the Plumeria and other tropical plants into an area where there are different pests/diseases/fungi not indigenous to them. We may have opened up a whole new category of pests/diseases/fungi for the Plumeria and other tropicals. Since we able to order the plants online from many other countries we may also be bringing in other commonly safe(to their location)pathogens that may mutate in the locations we now place them in. I think I will stop now before I confuse myself. I hope my attempt to write what I am trying to say makes sense. The more I write, the less it does.

If you don't have a University with a Horticultural Sciences school, your local Agricultural Extension may be able to help you.
Andi

Andi Great idea, but I do not have time/energy to do so with a demanding professional career. I decided to cut the trunk at the junction of the bad and good. It was basically shriveled up, no wet rot, and the stem a hollow shell. I cut up the other pieced, and see if they root. My other 2 plants were healthy. It could very well be poor wintering technique, as I have been 5 hours away from home working during this time. My wife does her best. A number of my other plants have almost dried out despite her efforts. I'll report back with what happens.