Summer Lows for Island Hotels

Hawaii hotel occupancy fell in August 2009 for the 18th straight month

Hawaii hotel occupancy fell in August 2009 for the 18th straight month, according to a survey compiled by Smith Travel Research in conjunction with Hospitality Advisors. The month finished at 70.9 percent occupancy, or 3.5 percentage points below that of the prior year. The August decline capped off the weakest summer season that Hawaii has experienced since the survey began in 1987.

When combined with the substantial room discounting that occurred in the market, the hotel industry lost an estimated $238 million in total revenue -- including revenue from room, food and beverage and retail sales -- during the 2009 summer season when compared to 2008, and $374 million when compared to the record summer of 2006.

“The loss in total hotel revenue has been staggering,” said Hospitality Advisors president Joseph Toy. “The 2009 occupancy rate of 68.1 percent for June through August 2009 was actually lower than the off-season occupancy rates Hawaii enjoyed just three years ago."

Toy noted that while the rate of occupancy loss has been slowing somewhat, the rate of room discounting accelerated substantially going into summer.

“Although room sales and occupancy declined during the summer, the steep room discounts have had a far greater impact on the loss in revenue for Hawaii’s hotel industry this past June through August,” Toy said.

Oahu posted the highest August 2009 occupancy of all islands at 78.3 percent, with Waikiki achieving hotel occupancies above 80 percent. Hawaii's Big Island recorded the lowest island hotel occupancy at 57.2 percent.