Hawaii occupancy up, but hotel rates lower

HAWAII While occupancy for Hawaii’s hotels improved 9.6% in June year-over-year, the demand was spurred on by room rates that were actually 1.5% lower than in 2009.

Occupancy on the islands rose to 71.4% in June, according to new data from Hospitality Advisors LLC. ADR for the month was US$169.68. For the first half of the year, Hawaii logged 69% occupancy on an average rate of US$171.78, which is down 5.2% from a year prior. Still, the higher occupancy has helped the state’s hotels to grow room revenue by 3.1% to US$1.21 billion during the first half.

Cut-rate pricing at some of Hawaii’s up-market resorts is hurting ADR across the board, with midscale properties struggling to maintain pricing power in the face of appealing “trade-up” offers.

Hawaii tourism analysts expect the discounting trend to continue through the rest of the year, when occupancy and ADR typically dip as children return to school and families stop traveling. Ben Rafter, president and CEO of Aqua Hotels & Resorts, says Hawaii visitors could see some great deals this fall.

“Getting people to come stay has not been difficult,” Rafter tells Honolulu Star Advertiser. “Getting rate has been another story. The hotels are full, which is great, but now we have a long road ahead to rebuild.”