The hotel industry has become synonymous with the Hawaii tourism industry, with a reputation for attracting some of the highest rates in the US.
It is also an expensive business to run.
However, that reputation may soon be tarnished by a new report which claims hotel occupancy rates have dropped to a record low.
The Hawaii Hotel Association (HHA) is calling for more hotel tax incentives, and the hotel industry says it has seen a fall in hotel room occupancy rates.
However the numbers are still higher than at any time since the early 1990s, according to HHA spokesman Chris Koehn.
“In 2017, we had a record high occupancy rate of 69% and we are now at 60%,” he said.
“So it’s not just a matter of occupancy rate, but we’re also seeing a drop in occupancy rates.”
Koehr said the drop in the occupancy rate could be due to increased demand, particularly from tourists and international travellers.
But he added there was little indication the occupancy rates were falling because of the increased travel demand.
“The numbers don’t indicate it, but it’s probably a combination of both,” Koehm said.
Hotel occupancy rates The HHA has previously been vocal about its concerns about the rising cost of hotel accommodation.
It has warned the industry about potential impacts on the hotel’s operating profit.
But Koehl said the occupancy numbers in 2017 were a far cry from that in the early years of the industry.
“We’ve seen occupancy rates go from 63% in 2016 to 61% in 2017,” he told RTE.
“And it’s very concerning because the occupancy is a significant part of the business and we need to pay for it.”
The HAA has also been calling for an increase in the state’s hotel tax, which has been pegged at 1.25% of the hotel room rate.
However it is unclear whether the tax will actually be raised in 2017.
Koehns warning about the decline in occupancy numbers came after a number of major hotels across the US closed their doors for the year.
The Marriott International Hotel and Resorts, the Sheraton, the Hyatt, the Wynn Las Vegas and others have all been shuttered in the last few months.
There have also been reports of the number of hotel rooms booked at hotels and motels falling sharply, with many people cancelling their stays.
The numbers of rooms booked in the Holiday Inn Express and Hilton hotels have also dropped by about 20%.
In the US the average occupancy rate has dropped from 63.9% in 2014 to 61.9%.
Koeehn said it was unlikely that the occupancy figures were declining because of this.
“Our occupancy rate is down significantly because the hotel is closing.
So I’m not sure that there’s any reason for us to be worried,” he added.
“I think the reason for concern is the cost of running the business.
I don’t know if that’s just going to be the cost associated with being a hotel.”
The decline in hotel occupancy figures is a big concern for the tourism industry.
Kroehn said the HHA was already considering introducing hotel tax increases as part of an effort to improve profitability, but said the state had not yet decided what to do.
“There’s a lot of discussion going on between the state and the state agencies about what’s going to happen in 2017 to make hotel occupancy numbers more reflective of the demand and the demand that’s being generated,” he explained.
“This is something that we have to start talking about and have a conversation with the agencies, and figure out what the optimal policy is.”