Maui's hotels gain revenue
POSTED: Friday, April 09, 2010
Maui saw big jumps in its hotel occupancy and revenue in February as the hotel industry continued a slow but steady recovery statewide.
Statewide occupancy rose 3.2 percentage points to 75.5 percent in February, according to the latest hotel report released today by Hospitality Advisors LLC.
Discounted room rates took a big toll on the industry's revenue per available room (RevPAR), but that gap appears to be narrowing. Statewide RevPAR slipped to $132.28 compared with $136.06 in February 2009.
“;We seemed to have bottomed out in losses in terms of room rates,”; said Joseph Toy, president and chief executive officer of Hospitality Advisors. “;As occupancies get firm, hotels are going to be able to manage those rates a little bit better and start raising.”;
Maui was the only island to see a jump in RevPAR in February, coming in with $183.55, as opposed to $179.97 in the year-earlier month. The increase came despite continued discounting and was the first revenue increase on Maui since March 2008, when airline closures reduced air service.
HOTEL OCCUPANCYOccupancy rates at Hawaii hotels in February and the same month last year:
Source: Hospitality Advisors LLC
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Occupancy increases in Wailea and in luxury markets were largely driven by West Coast visitors, while Kihei, Kaanapali and budget markets saw a rise in Canadian visitors.
“;It's because of the substantial increase in visitor arrivals in Maui,”; Toy said. “;The volume in room sales more than offset the decline in room rates. It's certainly a welcome sign.”;
Oahu had a 3.4 percentage-point increase in occupancy but a 3.8 percent decline in room revenue. International arrivals from Canada, Japan and Europe drove the increase. The Hawaii Tourism Authority reported earlier that Oahu's domestic arrivals fell by 9 percent in February, the largest of any island due to the Pro Bowl's absence.
Budget properties statewide saw a 5.4 percentage-point jump in occupancy, the largest in any of the markets. Luxury and upscale markets also increased above 3 percentage points.
“;When the Canadians come in, they want value,”; Toy said, which is why the cheaper properties made gains. “;The good news is even though they're generally budget travelers, they stay longer, with 12 1/2 days on average.”;
Toy said the hotel industry is experiencing firm recovery. February's occupancy increase was the fifth in the past six months.
The summer should provide a more accurate picture of how far tourism has recovered.
An increase in interest from strategic investors looking to acquire properties here is also another positive sign. Hawaii as a mature destination has strong appeal for investors.
“;You really need those new investment dollars to help fuel reinvestment and reinvigorate the economy,”; Toy said. “;You must have a clean-out of the bad debt that's in Hawaii before you can have true recovery.”;