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August hotel occupancy up

The summer ended stronger compared with last year's, with budget inns 80% full

By Kristen Consillio


Hawaii's hoteliers continued to see improvements in occupancy and revenue per available room -- a key measure of profitability -- in August.

Statewide hotel occupancy climbed 6.3 percentage points over the previous year to average 75.7 percent, while the average daily room rate inched up 1.8 percent over last year to $181.49, resulting in an 11.1 percent increase in revenue per available room to $137.39, according to a report released today by Hospitality Advisors LLC.

August's performance rounds out a relatively strong summer compared with last year, when arrivals were down due to the economy and swine flu fears. Revenue per available room at hotels statewide jumped 13.8 percent in June and 18.2 percent in July.

"We had busy months, and we're seeing volume being built back into the market but we're still well below our peak years," said Joseph Toy, Hospitality Advisors' president and chief executive officer. The peak year for August occupancy was in 2005, when occupancy hit 86.2 percent. "Last year we also had a very poor summer, so we're seeing some nice gains, but obviously the reality is we're still climbing out of a steep hole."

Budget hotels saw the highest occupancy for the month, rising 11.5 percentage points to 80.5 percent, indicating that consumers are still looking for deals. This category also saw room rates climb 7.9 percent and revenue per available room soar 25.9 percent.

Oahu hotels were the fullest in August at 83.7 percent, while Maui led the state with the highest room rate at $238.07.

While the increases are a bright spot for hoteliers, the market continues to recover slowly with significantly fewer fall group bookings, which are typically scheduled far in advance. The benefits of new group bookings won't be seen for one to three years.

The sharpest declines over the past two years have been in group business both nationally and in Hawaii. Group bookings are particularly important for hotels during the off-season.

"We have a lot of pent-up demand that's coming back into the market," Toy said. "Hawaii is one of the leaders in the market nationally in the industry recovery. ... We have a way to go until the market gets back."

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