Preheat oven to 350F (177C) and prepare a 13x9 pan by lining with parchment paper (or lightly grease and flour). Set aside.
Combine butter and cream cheese in the bowl of a stand mixer (or use a large bowl and an electric mixer). Beat together on medium-speed until well creamed (about 1 minute).
Add sugar and gradually increase mixer speed to high, beating until well-combined and fluffy (about 1 minute).
Add eggs and egg yolk, one at a time, stirring well between each addition. Scrape down the sides and bottom of the bowl as needed to ensure ingredients are well-combined.
Stir in vanilla extract and coconut extract.
In a separate, medium-sized bowl, whisk together flour, baking powder, and salt.
Gradually add dry ingredients to wet, stirring on medium-low speed until completely combined.
Spread batter evenly into prepared pan and bake on 350F (177C) for 25 minutes. Allow cookie bars to cool completely in pan before covering with coconut cream frosting. -- Do not turn off the oven, you will use it to briefly toast your coconut next.
Coconut Cream Frosting
Line a cookie sheet with parchment paper and sprinkle 1 cup of coconut evenly over the cookie sheet. Bake in 350F (177C) oven for 3 minutes, remove, turn with spatula, and return to oven and repeat until coconut is lightly browned (about 10-15 minutes, total). Allow toasted coconut to cool while you prepare the frosting.
In the bowl of a stand mixer, cream together butter and cream cheese.
Gradually, slowly, add powdered sugar, beating until combined. Add milk and stir, increasing speed to high, and beat until smooth and creamy (about 30 seconds on high)
Sprinkle in salt and add extracts, stir well.
Spread frosting evenly over cooled cookie bars. Press 1 ½ cups untoasted coconut over cookie bars, and then sprinkle toasted coconut overtop. Cut and serve. Frosting will set and become more stable as it sits.
Optional: For an extra decadent treat, drizzle with melted dark chocolate.