Hotel occupancy
plunges

All islands suffered from
the slowdown as traffic hit a
15-year August low

By Russ Lynch
Star-Bulletin

Hawaii hotel occupancy last month was the lowest for August in 15 years, with Oahu hardest hit by the continued slowdown in tourist arrivals from Japan.

All islands suffered from the decline, a change from recent months in which popular spots on the Big Island and Maui showed increases despite a statewide downturn, according to the latest figures from the accounting and consulting firm PKF-Hawaii Inc.

August, with its summer traffic, is normally one of the best months for hotel occupancy.

Last month, hotels across the state were only 75.8 percent full, a drop of nearly three percentage points from 78.6 percent in August 1997 and the lowest since 75.3 percent in 1983.

The news was even worse for Oahu, where the majority of the state's hotel rooms are. Oahu had the lowest occupancy rate in 19 years, according to the PKF-Hawaii report.

Meanwhile, the statewide average room rate was almost unchanged -- only half a dollar higher than the year-earlier month -- at $143.78 compared with $143.58.

Maui had the consolation of a slightly higher average room rate last month, $163.99 compared with $161.10 in August 1997, but also saw average occupancy slip to 76.9 percent from a year-earlier 78.1 percent.

Kauai had a higher August average room rate too -- $158.34 compared with 154.42 in August 1997 -- but saw its average occupancy slip nearly two points to 77.1 percent from 78.1 percent.

The Big Island, which was doing well earlier this year, came out virtually flat at an occupancy rate of 69.7 percent compared with a year-earlier 70.5 percent and its average room rate was also nearly flat at $161.34, just above the average of $161.02 in August 1997.

The Kohala Coast of the Big Island was one bright spot in room rates for the industry. The luxury resort area's rates, usually among the highest in the state, were up about $11 to $218.42 last month vs. $207.23 in August 1997. But the area's occupancy fell about six percentage points to 68.9 percent from 74.8 percent.

Molokai was basically unchanged at 39 percent occupancy and a $71 room rate.

Oahu saw its average occupancy fall more than four percentage points to 77.4 percent, from 81.7 percent in the year-earlier month, and the average August Oahu room rate slipped more than $2 to $126.11, from $128.81.

Even the cheapest Oahu vacation units, in the hotels and condominiums away from the beach with no restaurant of their own, saw their figures fall. The average occupancy in that category last month was 74.9 percent, down from 76.8 percent in the year-earlier month, and that group's average room rate was $69.28, down from $73.71.

Oahu's August occupancy last month was the lowest for August since the industry recorded an occupancy rate of 76.8 percent in August 1979, said Ernie Watari, PKF-Hawaii chairman and chief executive officer.

"The island of Oahu usually averages and occupancy in the mid-80s to low-90s for the month of August," Watari said. "Once again, this is a result of the continued downturn in Japanese visitors to Hawaii."

The Hawaii Visitors & Convention Bureau, which won't report its August tourism statistics for another week or so, earlier reported an 8 percent decline visitors from Japan and other Asia-Pacific countries for the first seven months of this year. Eastbound arrivals are also staying a shorter time, making things worse for the hotels, the HVCB numbers show.