According to a report released by Smith Travel Research and Hospitality Advisors LLC, hotel occupancy across the state was 73.8 percent in September 2012. More impressively, the average daily rate had increased by 8 percent to $186.47 and revenue per available room had increased by 7 percent to $137.61 per night. While these numbers have been strong, industry experts are quick to point out that higher costs have reduced hotel profits. Chief Executive Officer for Outrigger Enterprises, David Carey, commented, ”The untold story is that while we may be having really positive revenues, we’re also experiencing record cost increases. Those costs marched along, rising all the way through the period. Profit margins have gone down because costs over the five-year period have grown faster than revenue.”
President and CEO for Hospitality Advisors, Joseph Toy, added, ”There’s certainly higher labor costs and utilities have gone up substantially. Property maintenance costs overall have increased. There’s a lot of pressure on earnings. It’s a new norm. Some of these costs are just going to be there. The whole story of the year has been really the recovery, which in turn was driven by Oahu. The Oahu market in turn was driven by a sharp increase in Japanese and other Asian markets like Korea and China, which all had double-digit growth. These markets overwhelmingly stay at hotels when compared to U.S. visitors who choose other types of accommodations, including time share and condominiums.”
The island of Oahu had the highest occupancy rate at 84.5 percent with Waikiki in particular having an occupancy rate of 85.9 percent. Maui, by comparison, had an occupancy rate of 65.1 percent and Kauai had an occupancy rate of 68.7 percent. The Big Island of Hawaii had the lowest occupancy rate of 54.2 percent.
Source: Honolulu Star Advertiser, 11-12-2012, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Broker-in-Charge, Realtor®
Global Executive Realty, LLC
www.myhawaiihomesearch.com
www.myhawaiicondo.com
www.myhawaiidreamhome.com
Posted by Jeff Uyemura-Reyes, Broker-in-Charge, Realtor®
Global Executive Realty, LLC
www.myhawaiihomesearch.com
www.myhawaiicondo.com
www.myhawaiidreamhome.com
