Garden Isle retail bucking
slowdown, mayor says

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By Anthony Sommer
tsommer@starbulletin.com

LIHUE >> Kauai's small retail stores are weathering the economic downturn following the Sept. 11 terrorist attacks on the East Coast, Mayor Maryanne Kusaka said in a report to the County Council yesterday.

"It's not gangbusters but they're doing OK," Kusaka said.

In fact, that's pretty much the picture on Kauai.

"Our occupancy rates are stronger than Oahu and stronger than Maui," Kusaka said. She noted Kauai is far less dependent on Japanese tourism than those two islands.

Hotel occupancy rates on Kauai normally range between 60 percent and 70 percent in the fall, the mayor noted.

Of the major resorts, the Radisson Kauai Beach Resort is reporting an occupancy rate 12 percentage points down from a year ago, but Kusaka added, "it's getting better every day."

The Marriott Resort is at 70 percent of capacity and cancellations are declining while bookings are increasing. The Hyatt is about 20 percentage points below its normal pace. The Princeville Hotel is about 10 percentage points lower than a year ago.

Timeshares, which make up almost 25 percent of the island's visitor accommodations, are reporting occupancy rates of between 60 percent and 90 percent, the mayor said.

United Airlines has not cut any of its direct flights from the mainland to Kauai and the planes are 80 percent full. The Kauai Visitor Bureau reported yesterday that a plan by American Airlines to begin daily nonstop flights to Kauai has been put on hold.

A decrease in retail sales appears to have at least as much to do with a drop in consumer confidence by residents as it does a cutback in visitor shopping, Kusaka said. The only sector that appears to be laying off employees is the activities industry. Workers' hours have been cut in many other areas and employees have been urged to use up vacation time but furloughs have been few.

Gini Kapali, Kauai County Economic Development Department director, said figures provided by the state Department of Labor show last week there were 97 new claims for unemployment benefits on Kauai due to layoffs and 40 of those were employees of tourism-related companies. By way of contrast, she said, there were 184 claims for partial benefits because of reduced work hours.