Hawaii’s hotel industry was at the top of its game
in January, outpacing most of the leading U.S. hotel markets.
In January, Hawaii hotels saw average occupancy grow to 84.1%, a climb of
4.6 percentage points from January 2019, according to a report released Thursday by the Hawaii Tourism
Authority, using data from STR.
Likewise, HTA reported that the statewide average daily rate (ADR) grew 5.6% to $314, and revenue per available room (RevPAR) grew nearly 12% to $264. RevPAR, which is the amount each hotel gets
per room regardless of its occupancy status, is considered the most telling
hotel performance measure by many in the industry.
Hawaii’s strong occupancy led to a robust year-over-year ADR gain, which was fourfold the national average of 1.4% growth to $126, said Jan Freitag, STR’s senior VP of lodging insights. The nationwide
industry also posted a year-over-year occupancy gain of nearly 1% to 55.1% and a RevPAR gain of just over 2% to more than $69, Freitag said.
“Hawaii continues to be an attractive market for visitors and hoteliers, who are in the market to experience some pricing power,” he said.
For example, it took the Feb. 2 Superbowl LIV in Miami and the Jan. 13 College Football Championships in New Orleans for Florida and Louisiana to achieve similar ADR results of 6% and just over 7%, respectively.
“The gains in Florida and Louisiana can be easily explained by just one event. But you have something equally as powerful: good weather,” Freitag said.
Freitag said Hawaii’s robust occupancy coupled with strong ADR led to a double-digit RevPAR gain. Only three other states — New Hampshire, Maine and Iowa — achieved double-digit RevPAR growth, he said
“It’s amazing how well
we are doing,” said Keith Vieira, principal of KV &
Associates, Hospitality Consulting. “Of course, the results are over a challenging period in 2019 when we were still recovering from 2018’s hotel strike, volcanic eruption and severe weather events.”
During January all islands achieved growth over the same period last year. Oahu posted the highest occupancy at 88%, while Maui had the highest ADR at nearly $478 and RevPAR at nearly $369. Kauai hotels, which struggled for most of last year, even saw gains in occupancy, ADR and RevPAR.
Oahu, which STR lists among its top 25 U.S. hotel markets, was one of only three in this category to achieve double-digit RevPAR growth. STR reported that Miami/Hialeah, Fla., posted a nearly 19% jump in RevPar to $215.89, while St. Louis, Missouri-Illinois, was the second-highest RevPAR gainer with a 14% growth rate to nearly $50. Oahu’s January RevPAR rose nearly 13%
to just over $223.
Erik Kloninger of Kloninger &Sims Consulting LLC said Oahu’s RevPAR gain appears to be driven in part by the higher rates hotels have been able to charge since August’s implementation of a city crackdown on vacation rentals.
“For the first 1o months of 2019, Oahu’s rate gains were less than inflation. Starting in November we had three months in a row of higher ADR growth, which coincided with vacation rental enforcement and the reduction of available vacation rentals on Oahu,” Kloninger said.
Sean Dee, Outrigger Hospitality Group’s executive vice president and chief marketing officer, said the three-month trend for Waikiki and Hawaii has been good for hotels as the recovery from “the negative impacting events of 2019 continues.”
“There are a myriad of drivers for this as usual,
but the continued airlift increase and stable airfares are certainly key contributors,” Dee said. “The United States is up 11% in seats in January and 1.5% from Japan, so good news from key source markets. But clearly the Waikiki RevPAR increases were supported by the drop in illegal vacation rental supply.”