Honolulu hotels topped Hotwire’s list of destinations with the largest January room rate increases.
Room rates booked by customers on Hotwire.com, an Internet-based travel agency, for travel this month to Honolulu climbed 20 percent from last January as air promotions have sparked more leisure travel.
"That means competition is high for the destination’s inventory of hotel rooms, which drives up pricing," Hotwire explained in a press release.
It’s been several years since Hawaii hoteliers have had enough demand to push rates higher. Hoteliers began offering deep discounts in the midst of the U.S. mortgage crisis and global financial meltdown, and have been hesitant to remove them at a time when consumers remain price sensitive.
January is one of the first months since the economy went into a tailspin when demand was strong enough that hoteliers could drop some of their special offers and raise rates. The same thing happened in June when the military’s Rim of the Pacific Exercise (RIMPAC) boosted demand, and in December with the Honolulu Marathon and the holidays.
BY THE NUMBERS
Hotels with largest January rate increases
If the pattern continues, it will be a welcome change for Hawaii hoteliers.
"Through our lens, 2011 is looking good," said Jack Richards, president and chief executive officer of Hawaii’s largest wholesaler, Pleasant Holidays LLC.
Other destinations topping the list for hotel room price increases were Miami; Providence, R.I.; Montreal; and Toronto. Most of the increases were due to strong leisure travel, business travel or were related to large group events, Hotwire said.
Much of Hawaii’s increase can be pegged to the Pro Bowl, which comes to Honolulu on Jan. 30, said Benjamin Rafter, president and chief executive officer of Aqua Hotels & Resorts.
"Demand for rooms during that time period has allowed us to raise rates," Rafter said.
The back-to-back Monday alignment of Valentine’s Day and Presidents Day, which falls on Feb. 21, should push demand into February as romantic couples and families with kids take advantage of the holiday sequence, he said.
"The way that these holidays fall is really positive," Rafter said. "A lot of mainland schools will have winter break at this time."
Hawaii hotel occupancies have also been buoyed by strong arrivals from U.S. East Coast and Canadian travelers who are looking to escape winter conditions, said Keith Vieira, senior vice president and director of operations for Starwood Hotels & Resorts in Hawaii and French Polynesia.
"This is traditionally a busy time because of winter travelers," he said.
Pleasant Holidays also reported strong January and February results.
"The Pro Bowl and the improvement in the economy are two factors that have helped us this year versus last," Richards said.
Not all destinations have begun the year with Honolulu’s advantages. Hotwire listed Flagstaff, Ariz.; Key West, Fla.; Albuquerque, N.M.; and Reno, Nev., as cities with the largest price drops.
Hotwire said the price drops, which ranged from 6 percent in Reno to 12 percent in Flagstaff, Ariz., were an attempt to spur domestic travel as stronger than normal winter storms have impacted tourism in certain parts of North America.
The Hotwire Hotel Rate Report calculates resorts by looking at Hotwire hotel stay dates and comparing them against prices in the same month during the prior year. Launched in 2000, Hotwire.com negotiates deep discounts from its travel suppliers to help travelers book unsold airline seats, hotel rooms and rental cars.