Hawaii bounces back, breaks streak of occupancy declines

Hawaii's hotel industry has been dealing with declining occupancy for 12 straight months -- but no longer. Pacific Business News reported that occupancy rose 0.6 percent state-wide to 72.7 percent for the month of May, a gain inline with the 1.4 percent increase in visitors to the country. The majority of these visitors hail from the U.S., Japan and Canada.

Average daily rates (ADR) rose 3.9 percent to $218.64, while revenue per available room (RevPAR) increased 4.8 percent to $158.95. A new record was set for the month of May, with  $390 million earned in total hotel revenue, with a 3.6 percent increase in visitor daily spending being attributed to honeymooners.

Oahu's hotel occupancy rate reached 90 percent -- a 2.6 percentage-point increase from 2013 -- followed by Kauai at 75.7 percent (down 1.5 percentage points), Maui at 72.4 percent (a 2.8 percentage-point decrease) and the Big Island at 64.6 percent (an increase of 2.8 percentage points).

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Survival in these times is highly dependent on a hotel's ability to quickly adapt and pivot their business to meet the current needs of travelers and the surrounding community. Join us for Optimization Part 2 – a FREE virtual event – as we bring together top players in the industry to discuss alternative uses when occupancy is down, ways to boost F&B revenue, how to help your staff adjust to new challenges and more, in a series of panels focused on how you can regain profitability during this crisis.

KITV reported that occupancy for luxury properties in the state grew 4.1 percent to 66.5 percent during May, while room rates reached $398.72 (up 1.5 percent). Despite this, Hawaii's economy hotels felt a 2.5 decrease in occupancy to 73.9 percent, while ADR for these properties dropped 2.5 percent to $97.15.

"Given the record highs that Hawaii enjoyed last year, the moderation in Hawaii's visitor industry was expected," Joseph Toy, president and CEO of Hospitality Advisors told KITV. "Although room rate growth has slowed to roughly half the pace achieved through May 2013, Hawaii nonetheless ranked first in the nation in ADR."

The record highs that Toy is referring to in 2013 included all four of Hawaii's major islands, resulting in record-breaking rates and high RevPAR. Even then, 2013 saw a slight decrease in occupancy on all but one of the major islands.

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