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Hawaii Hotels Finish 1998 with an Occupancy Rate of 64.2%, Down from 1997 Occupancy of 66.4% /  PricewaterhouseCoopers
 
NEW YORK and HONOLULU, March 16, 1999 -  Hotels in Hawaii ended 1998 with an occupancy rate of 64.2 percent, according to the PricewaterhouseCoopers Lodging Research Network (www.lodgingresearch.com) and Smith Travel Research. That rate is lower than Hawaii's 1997 level of 66.4 percent occupancy, the firms say.

Meanwhile, average daily room hotel rates in Hawaii rose just 0.5 percent in 1998 -- far less than the U.S. national average rise of 4.5 percent, according to the report. And average daily room rates actually decreased in some categories of Hawaii hotels in 1998, which together operate Hawaii's largest survey of hotel operating statistics.

"Hawaii is a rare travel bargain at the moment, with plenty of hotel rooms -- and room rates that are more than reasonable," observes Joseph Toy, Honolulu-based director of hospitality and leisure consulting in PricewaterhouseCoopers' Financial Advisory Services (FAS) practice. "Of the five hotel types we follow -- luxury, upscale, midprice, economy and budget -- average daily room rates were actually lower in two hotel types, and occupancy was lower in four types," Mr. Toy notes. Mr. Toy attributes the declines in large part to reduced travel to Hawaii -- and in particular Waikiki -- from Asia during 1998.

Average daily room rates at Hawaii's economy hotels fell 1.05 percent from $78.69 in 1997 to $77.86 in 1998. Hawaii's budget hotel experienced an 0.5 percent drop in room rates, from $63.82 in 1997 to $63.49 in 1998. "Needless to say, it is unusual anywhere in the U.S. for average daily room rates to decrease year-on-year," Mr. Toy observes. In Hawaii's luxury, upscale and midprice hotels, average daily rates increased -- but modestly. For example, at Hawaii's luxury hotels, average daily room rates rose a mere 74 cents from $135.08 in 1997 to $135.82 in 1998, Mr. Toy says.

Occupancy rates were lower in Hawaii's luxury, upscale, midprice and economy hotels in 1998 versus 1997. Upscale hotels experienced the biggest occupancy decline, a 6.4 percent drop from 64.3 percent occupancy in 1997 to 60.2 percent occupancy in 1998. Midprice hotels experienced a 4.9 percent occupancy drop from 70.1 percent occupancy in 1997 to 66.7 percent in 1998. Luxury hotels' occupancy fell 1.7 percent from 66.3 percent occupancy in 1997 to 65.2 percent in 1998. Only budget hotels saw occupancy rise, from 64.5 percent in 1997 to 65.1 percent in 1998.

"Travelers will find Hawaii a most hospitable destination that's in many cases easier on the wallet than in the past," Mr. Toy says. "Hotels on the island of Oahu, which is home to Waikiki, in particular are offering substantial value-added packages, including extra nights free, inclusive meals and rental cars," Mr. Toy noted.

PricewaterhouseCoopers (www.pwcglobal.com) helps its clients develop and execute integrated solutions to build value, manage risk and improve their performance. Drawing on the knowledge and skills of 150,000 people in 150 countries, PricewaterhouseCoopers provides a full range of business advisory and consulting services to leading global, national and local companies and to public institutions. The company's objective is to have measurable impact. PricewaterhouseCoopers' goal is to work with clients to make the world a better place.

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Contact:
Adam Brecht 
of PricewaterhouseCoopers LLP, 212-596-5079, [email protected]
http:/www.lodgingresearch.com
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Also See: Hawaii Hotel Occupancy Drops While Room Rates Hold Steady Reports PricewaterhouseCoopers / Oct 1998 

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