Wednesday, June 23, 1999

Hotel slump

'Golden Week' failed to boost
the local industry last month

By Russ Lynch


Art With one in every three rooms lying empty, Hawaii hotels had the worst May occupancy since 1983, according to figures issued today by the hotel industry consulting firm PKF-Hawaii Inc.

However, hotels managed to get slightly higher room rates, somewhat making up for the lower traffic. Statewide, hotels and resort condominiums averaged 66.3 percent occupancy last month, down slightly from the also-poor showing of 67.1 percent in May 1998, the PKF report said.

Last month's average was only three points higher than the 63.3 percent average for May 1983, which was the worst May since PKF-Hawaii began compiling hotel statistics in 1972.

Room rates averaged $135.09 a night last month, up 0.9 percent from $133.87 in the previous May.

Ernie Watari, chairman and chief executive officer of the consulting firm, said room rates brightened a flat month and there were some occupancy increases in individual parts of the state.

Maui and Kauai did particularly well compared to the rest of the state, showing strong increases in both occupancy and the average daily room rate, thanks to a strong flow of visitors from the mainland, Watari said.

Japanese business was down statewide, however, as the hoped-for increase from "Golden Week" holiday travelers did not materialize, he said.

For the last several years, Japanese visitors have become more price-conscious and many have learned to avoid the peak holiday periods when vacation prices are high.

Among the individual islands, Kauai had the highest occupancy in the state, averaging 71.3 percent last month, an increase of 8.4 percentage points from 62.9 percent in May 1998. Kauai's average room rate last month, $155.55, was up 7.8 percent from $144.29 in the year-earlier month.

Maui's May occupancy of 70.5 percent last month was up 4.5 percentage points from the May 1998 average of 66 percent and the average room rate last month, $153.20, was up 2.6 percent from $149.27 average a year earlier.

The Big Island took a beating, however, with an occupancy average of 57.6 percent, down 11.3 points from the year-earlier 68.9 percent, and a 2.8 percent drop in the average room rate to $156.60 last month, from $161.18.

Oahu also had a fall in both occupancy and room rates, reporting rooms 66 percent full, down more than two points from 68.3 percent in May 1998, and an average room rate last month of $115.65, down 1.2 percent from $117.03.

Waikiki averaged 66.9 percent occupancy, down 2.8 points from 69.7 percent a year earlier, and had an average room rate last month of $116.34, down 1.6 percent from $118.27.

Molokai crept along at a 38.5 percent occupancy average, just about flat from 38.2 percent in May 1998, with an average room rate of $68.31 last month, down 9.6 percent from $75.59 a year earlier.

PKF-Hawaii studied results from 82 hotels and 63 resort condominiums with a total of 40,027 rooms, or 56 percent of the available rooms in the state.

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