Insight Hawaii Insight ‘Very encouraging’ signs as hotels see 8.7% increase in room revenue By Shane Nelson / February 18, 2011 Share 1 -- Hotels across the Aloha State took in $2.55 billion in room revenue during 2010, an increase of 8.7%, or $203 million, over 2009. Total revenue for Hawaii hotels, including sales from retail and food and beverage, was $3.78 billion last year, according to a recently released 2010 industry report from Hospitality Advisors and Smith Travel Research. “The strengthening of the market recovery, particularly during the second half of 2010, is very encouraging,” Joseph Toy, president and CEO of Hospitality Advisors, said in a statement released with the report. “Pent-up demand for travel to Hawaii, combined with attractive hotel pricing, should continue to build momentum in the market going into 2011.” While the 2010 hotel revenue figures represented a welcome improvement over the previous year, the totals fell far short of Hawaii’s all-time highs, in 2007. That year, room revenue was $3.06 billion across the state, and total hotel revenue was $4.54 billion. “The recovery is still uneven as Kauai and the Big Island continue to lag in the recovery, which is typical during this stage of the market cycle,” Toy said. “Although visitor arrivals and room demand [are] clearly rebounding, pricing recovery will be slower, given the deep discounts that the market has experienced over the past 30 months.” Occupancy across Hawaii was 70.7% during 2010, up nearly 6% year over year, while the average daily room rate was $174.33, off 1.6% from 2009. At luxury properties, ADR was $249.77. However, revenue per available room climbed significantly in 2010, increasing 7.4%, to $123.25 a night. Budget hotels recorded the highest occupancy rates for the year, at 77.9%. “The recovery of the group market, which includes meetings, conferences and incentive groups, will also be critical, given that this segment represents a major base market for the industry,” Toy added. “This market essentially evaporated during the past two years, not only for Hawaii but for the U.S. lodging market as a whole.” Across the nation, Hawaii’s 2010 ADR was second only to New York’s $232.29, and the Islands’ statewide RevPAR again finished behind only the Big Apple’s $187.93.