Think About It: Full Rooms & Coffers - KFVE, K5-Hawaii News Now, Local Programming

August 15, 2013

Think About It: Full Rooms & Coffers

How good are things right now in the tourist industry locally? Good enough such that hotels are feeling more comfortable raising their prices as rooms are almost completely filled. It's the old supply and demand game, and demand has been pretty good for quite some time now, and since the local hotel supply is limited, room rates inevitably go up when tourism times are good.

But it's a balancing act- raise rates too high or too quickly- especially with the 30% drop in the value of the Japanese yen vs. the dollar in the past year- and potential guests opt to go elsewhere. But if hotels don't raise rates as rooms fill up, they lose potential dollars from guests willing to pay for paradise. So while the growth in tourists might be slowing down in the months and year ahead, each guest is probably paying a bit more, at least to the hotels. While we yearn for other forms of steady revenue to help prop up our tax base, tourism is still the driver for our local economy.

Construction starts are also looking good for the coming year, with many big projects planned or underway. Economist expect about 10% growth in construction this year and next, and that should help our economy continue to move forward at a faster clip than the rest of the nation. An improved economy bodes well for consumers and for infrastructure repairs so badly needed on roads, at airports, and in schools. Full hotel rooms are like a full house in poker- a real winner for all. Think about it…

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