How does Hawaii hotel performance compare to other destinations?

“Hawaii’s hotels compete very well against other exotic, tropical destinations. The Hawaiian Islands stands out as a premier, aspirational destination with hotel rates that are in line with similar types of destinations around the world. However, an advantage offered by Hawaii is the diversity of hotel products and range of price points to match travelers’ spending capabilities,” said Jennifer Chun, Hawaii Tourism Authority (HTA) director of tourism research.

Hawaii hotels statewide enjoyed a robust first quarter to begin 2018, reporting solid increases in revenue per available room (RevPAR), average daily rate (ADR) and room occupancy. According to the Hawaii Hotel Performance Report released today by HTA, RevPAR grew to $243 (+8.9%) and ADR to $293 (+6.9%) with occupancy of 82.9 percent (+1.5 percentage points) in the first quarter compared to a year ago (Figure 1).

HTA’s Tourism Research Division issued the report’s findings utilizing data compiled by STR, Inc., which conducts the largest and most comprehensive survey of hotel properties in the Hawaiian Islands.

All classes of Hawaii’s hotel properties reported RevPAR growth in the first quarter, with hotels on opposite ends of the spectrum, Luxury Class and Midscale & Economy Class, both achieving double-digit increases. Luxury Class hotels earned RevPAR of $475 (+13.9%), driven by increases in both ADR at $600 (+10.8%) and occupancy of 79.2 percent (+2.2 percentage points). Midscale & Economy Class hotels reported RevPAR of $146 (+13.1%), fueled by increases in ADR at $173 (+8.8%) and occupancy of 84.4 percent (+3.2 percentage points).

Jennifer Chun, HTA director of tourism research, commented, “The first quarter was also the first three-month period in which we realized the full impact of new trans-Pacific air service that was added last year. The strength of Hawaii’s hotel performance in all island counties was supported by the expansion of air seat capacity to accommodate travel demand.”

All Island Counties Report First Quarter Growth in RevPAR, ADR and Occupancy

Each of the four island counties enjoyed a strong performance by their respective hotel properties in the first quarter. Kauai’s hotels led the state in RevPAR growth to $249 (+16.2%), boosted by increases in ADR to $306 (+13.4%) and occupancy of 81.1 percent (+2.0 percentage points).

Maui County hotels led the state in both total RevPAR at $346 (+14.2%) and total ADR at $432 (+12.9%) in the first quarter, while occupancy rose slightly to 80.2 percent (+0.9 percentage points).

Oahu hotels led the state in occupancy of 84.3 percent (+1.5 percentage points) in the first quarter, with RevPAR rising to $198 (+2.4%) and ADR of $235 (+0.6%) being similar to a year ago.

Hotels on the island of Hawaii produced great results in the first quarter, with increases in RevPAR to $243 (+14.7%), ADR to $294 (+11.4%) and occupancy of 82.6 percent (+2.4 percentage points).

Among Hawaii’s resort regions, hotels in Wailea, Maui, led the state with growth in RevPAR to $584 (+20.2%) and ADR to $660 (+17.7%) in the first quarter. Wailea also recorded the state’s highest regional occupancy at 88.6 percent (+1.8 percentage points). Also, on Maui, hotels in the Lahaina-Kaanapali-Kapalua resort area reported growth in RevPAR to $285 (+11.6%), ADR to $357 (+10.7%), and occupancy of 79.9 percent (+0.6 percentage points).

The Kohala Coast resort area on the island of Hawaii recorded strong increases in RevPAR at $344 (+17.6%) and ADR at $416 (+15.0%), along with growth in occupancy to 82.6 percent (+1.9 percentage points) in the first quarter.

Waikiki hotels also realized growth in the first quarter with RevPAR at $195 (+2.1%) and occupancy of 85.1 percent (+1.5 percentage points), while ADR was similar at $230 (+0.3%) to a year ago.

Hawaii Hotels Compare Favorably to Domestic and International Destinations

In comparison to top U.S. markets, the Hawaiian Islands ranked number one in RevPAR at $243 for the first quarter, followed by Miami/Hialeah at $216, and San Francisco/San Mateo at $181 (Figure 2). Hawaii also led the U.S. markets in ADR at $292 (Figure 3) and ranked third for occupancy at 82.9 percent, finishing behind two popular Florida destinations in Miami/Hialeah at 85.3 percent and Orlando at 84.0 percent (Figure 4).

When compared to international “sun and sea” destinations, Hawaii’s hotels performed well in the first quarter (Figure 5). Hotels in the Maldives ranked highest in RevPAR at $620 (+8.9%), with Maui County hotels coming in a distant second at $346 (+14.2%), followed by Aruba at $324 (+17.4%), French Polynesia at $292 (+23.0%), and Cabo San Lucas at $283 (+11.1%). Kauai at $249 (+16.2%), the island of Hawaii at $243 (+14.7%), and Oahu at $198 (+2.4%) ranked sixth, seventh, and eighth, respectively.

The Maldives also led in ADR at $809 (+1.2%) in the first quarter, followed by French Polynesia at $508 (+25.2%), Cabo San Lucas at $447 (+23.6%), Maui County at $432 (+12.9%), Aruba at $419 (+13.0%), Kauai at $306 (+13.4%), the island of Hawaii at $294 (+11.4%), Cancun at $246 (+216.0%), and Oahu at $235 (+0.6%). There were several less expensive competitive destinations as well (Figure 6).

Hotels in Phuket recorded the highest average occupancy for sun and sea destinations in the first quarter at 91 percent (+3.5 percentage points). Oahu was next at 84.3 percent (+1.5 percentage points), followed by the island of Hawaii at 82.6 percent (+2.4 percentage points), Puerto Vallarta at 82.4 percent (-0.6 percentage points), Costa Rica at 81.6 percent (+2.8 percentage points), Kauai at 81.1 percent (+2.0 percentage points) and Maui County at 80.2 percent (+0.9 percentage points). (Figure 7)

March 2018 Hotel Performance

Hawaii hotels statewide continued their strong start to 2018 with very good results in March, reporting increases in RevPAR to $236 (+11.5%) and ADR to $289 (+7.9%), with occupancy of 81.7 percent (+2.6 percentage points) compared to a year ago. All classes of hotel properties and all island counties reported increases in RevPAR that ranged from solid to exceptional.

Luxury Class hotels led in growth of RevPAR to $475 (+15.1%) in March, bolstered by increases in ADR to $600 (+8.9%) and occupancy of 79.1 percent (+4.3 percentage points). Upper Upscale Class hotels recorded the highest occupancy in March at 86.2 percent (+2.2 percentage points).

“Hotel properties in all four island counties performed very well in March, which helps to strengthen the base of tourism’s benefits across the state,” said Chun. “The results for Kauai and the island of Hawaii are particularly notable. RevPAR was exceptional and ADR was strong in March, but the occupancy rate for both islands far exceeded what was reported the first two months. The impact of new air service being added is reflected in the significant increase in occupancy.”

Maui County hotels reported the highest RevPAR at $340 (+11.4%) in March, with strong ADR growth to $427 (+11.9%), which offset flat occupancy of 79.6 percent (-0.4 percentage points). Wailea hotel properties led the state’s resort regions in all three categories in March, recording increases in RevPAR to $590 (+14.6%), ADR to $665 (+12.8%), and occupancy of 88.8 percent (+1.4 percentage points).

Kauai hotels earned the state’s highest RevPAR growth in March, increasing to $245 (+22.8%), which was boosted by ADR of $304 (+15.7%) and occupancy of 80.7 percent (+4.7 percentage points).

Hotels on the island of Hawaii also realized a strong March with RevPAR rising to $237 (+18.8%), bolstered by increases in ADR to $290 (+11.3%) and occupancy of 81.7 percent (+5.1 percentage points). Kohala Coast hotels had an impressive month, with RevPAR increasing to $337 (+22.7%), growth in ADR to $414 (+12.9%) and occupancy of 81.2 percent (+6.5 percentage points).

Oahu hotels enjoyed a solid March, with increases in RevPAR to $190 (+7.2%), ADR to $230 (+3.4%), and occupancy of 82.7 percent (+3.0 percentage points). Waikiki hotels earned RevPAR of $186 (+7.0%), supported by an increase in ADR to $223 (+2.5%), and growth in occupancy to 83.5 percent (+3.5 percentage points).