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Isle hotel
occupancy
edges up

The state shows a gain
for the 9th straight month
despite declines on the
Big Island and Kauai

---

By Russ Lynch
Star-Bulletin

Hawaii hotels and resort condominiums had another bumper month in September, their ninth consecutive month in which occupancy levels were higher than the year-earlier level.

The hotel industry consultant firm PKF-Hawaii said today that statewide occupancy last month was up 2.4 percentage points at 76.4 percent, from 74 percent in September 1999.

The stronger occupancy levels enabled the tourist accommodations to charge more and the statewide average room rate rose 3.8 percent to $142.11 last month, from $136.93 in the year-earlier month.

However, the industry has some worries, according to Ernie Watari, PKF-Hawaii chairman and chief executive officer.

"Volatility in the U.S. stock market, tension in the Middle East and clear indications that the Federal Reserve Bank has been successful in slowing the U.S. economy are cautionary signals that coming months may not be as rosy as the past nine," Watari said.

He also noted that the percentage of occupancy increase has been narrowing.

Still, Watari said PKF is maintaining its "cautious optimism" for Hawaii tourism.

For September, Oahu, Maui and Molokai showed islandwide occupancy increases but Big Island occupancy was down nearly three points and Kauai occupancy slipped slightly. The districts where occupancy is usually high showed relatively flat performance last month.

Oahu's islandwide occupancy averaged 79.5 percent, up from a year-earlier 76.6 percent, with the pricier hotels -- the full-service properties on Waikiki Beach -- showing an increase of less than two points to 80.8 percent last month from 79.1 percent in the previous September.

The Waikiki properties away from the beach and without their own restaurants, where many bargains are to be found, showed a seven-point occupancy increase, to 79.8 percent from a year-earlier 72.8 percent.

The beachfront hotels charged an average of $157.83 a night last month, up 3.1 percent from $153.10 in September 1999. The off-beach, no-restaurant Waikiki properties raised their average room rate 7.2 percent to $64.22 from a year-earlier $59.89.

Big Island occupancy averaged 66.9 percent last month, down 2.7 percentage points from 69.6 percent a year earlier.

The average room rate on the Big Island, $159.42 last month, was up 2.7 percent from a year-earlier $155.23, but there were areas of significant slippage. Occupancy on the Kohala Coast, where the room rates were by far the highest in the state, dropped more than two points to 67.5 percent from 69.8 percent and the average room rate there was down 3.7 percent at $214.96, from $223.23 in September 1999.

Maui did better with higher occupancy, 76.8 percent compared with a year-earlier 72.2 percent, and higher room rates, up 7.6 percent at an average of $171.78 from $159.68 in September 1999. Kaanapali occupancy dipped to 81.2 percent from a year-earlier 83.1 percent but the average Kaanapali room rate rose 2.6 percent to $164.49, from $160.26.

Kauai occupancy was down less than one percentage point, at 75.7 percent from a year-earlier 76.1 percent, and the average room rate on that island rose 7.1 percent to $165.40, from $154.45.

Molokai continued to have the lowest occupancy in the state but it rose more than two points to 36.1 percent, from a year-earlier 33.9 percent. Molokai's average room rate rose 4.7 percent to $79.29 last month from $75.70 in September 1999.