Occupancy rates for Hawaii fared worse than the national average in 2008 due to the economic downturn and a weak performance during the peak summer season, according to a report released yesterday by Ernst & Young LLP.

Based on year-to-date data from Smith Travel Research, Hawaii's overall occupancy decreased 4.5 percentage points to 70.8 percent. While average daily room rates increased by 1 percent to $202, revenue per available room dropped by 5 percent to $143.

Most cities experienced declines in U.S. lodging demand and occupancy last year, as well as slowing growth in key metrics such as average daily room rates (ADR) and revenue per available room (RevPAR); however, the national average for occupancy declined only 4.3 percent.

Phoenix, Atlanta and Chicago joined Hawaii in falling below the national average. Meanwhile, Los Angeles; New Orleans; San Francisco; Miami; Manhattan, N.Y.; Dallas; Ft. Lauderdale, Fla.; Washington, D.C.; Philadelphia; Boston; Orlando, Fla.; Las Vegas and San Diego fared better.

Hotel markets across the world are expected to experience continued economic pressure and reduced leisure and business travel in 2009, the Ernst & Young report said.

“;There is little doubt that most markets in the current economic climate are challenging at best and growth will be hard to come by for most operators,”; said Michael Fishbin, Ernst & Young's national director of hospitality services. “;As a result, this year we will see hotel operators continue to focus more of their energies on cost reduction, improving operating efficiencies in their hotels, reaching out to guests via enhanced Internet communication and strengthening their brands through an emphasis on green principles in activities related to both development and operations.”;