StarBulletin.com

Isle hotel rates fall


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POSTED: Thursday, January 07, 2010

Despite relatively flat statewide occupancy rates and a respectable 4.1 percentage point gain in Waikiki hotel occupancy, Hawaii hoteliers continued to struggle in November.

The statewide average daily hotel room rate fell for the 17th consecutive month to $161.08 in November, causing the statewide revenue per available room to fall another 10 percent, hotel consultancy Hospitality Advisors LLC reported today.

Occupancy at Hawaii hotels averaged 63.1 percent in November, a 0.4 percentage point decrease from November 2008. However, revenue per available room, considered by many to be the best measure of hotel profitability, fell to an average of $101.64 a night, from $112.90 a year earlier.

               

     

 

HOTEL OCCUPANCY

        Occupancy rates at Hawaii hotels in November and the same month last year:
       

 

       

       

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
BY ISLAND
 20092008
Oahu72.6%69.0%
Kauai49.8%60.3%
Maui58.0%61.2%
Big Island46.9%50.5%
STATEWIDE
Totals63.1%63.5%

       

Source: Hospitality Advisors LLC

       

 

       

       

The results are in keeping with the 5.5 percent drop in Hawaii visitor arrivals through November and the 12.9 percent drop in visitor spending.

“;We are almost even with 2007 on occupancy, but we are nowhere near that on rate and revenue,”; said Barry Wallace, vice president of hospitality services for Outrigger Enterprises Group.

Waikiki saw November visitor gains thanks to Oahu conventioneers and tourists from Japan and Canada.

“;We are very pleased with a 10 percent increase in international visitor arrivals in November,”; said state Tourism Liaison Marsha Wienert. “;International arrivals were bolstered by a 7.9 percent increase in Japanese arrivals, which is the third consecutive month of growth out of Japan.”;

About 30,000 visitors from around the world came to Oahu in November to attend the international convention for Jehovah's Witnesses, helping to boost Oahu's occupancy by 3.6 percentage points.

“;We saw strengthening in November and December,”; said Jack Richards, president and chief executive officer of Hawaii's largest wholesaler, Pleasant Holidays LLC. “;The second half of the year was better—things began to improve in late May or June and we saw it get better.”;

Occupancy gains aside, Oahu hotels suffered in November from a 7.9 percent drop in average daily room rates, which fell to $144.11. The decrease in room rates pushed revenue per available room down to $104.62, a 3.1 percent decline.

Hoteliers on Kauai and the Big Island saw occupancy rates fall below 50 percent in November, while Maui hotels achieved only 58 percent occupancy. Kauai hoteliers saw revenue per available room fall to $89.89, a decrease of 22.1 percent, the largest in the isles.

In November, nearly all hotel categories and locations saw a drop in the average daily room rate and revenue per available room.

The Big Island's luxury Kohala Coast was the only sub-market to post increases in occupancy and revenue per available room; however, only 46.6 percent of its rooms were filled in November, the lowest occupancy in the state.

For 2009 through November, all hotel categories and locations saw drops in occupancy, room rate and revenue per available room.

While occupancy is expected to post gains in 2010, Hawaii's hoteliers do not anticipate increases in average daily room rates or spending.

“;We'll surpass both 2008 and 2009 in 2010 in occupancy, but not in (average daily hotel room) and spending,”; Wallace said. “;The good news about 2010 is that the year-over-year comparisons are against a really rotten year, so everything will look good for a while.”;

It could be five years before Hawaii hoteliers are able to charge average daily room rates that match those of the last peak, he said.