Hawaii Real Estate starts Here!

Hawaii tourism was upgraded by local economists saying that visitor arrivals would increase by 6.5% up by 2.1% meaning visitor arrivals would exceed 7.7 million by the end of the year.  The Department of Business, Economic Development and Tourism’s (DBEDT) latest report predicts economic growth for Hawaii at 2.2% this year with largest gains to be made in tourism.  Visitor spending is also expected to increase by 9% up by 2.6% from the department’s previous report.  The DBEDT bases these increases on better than expected tourism numbers in the first quarter of 2012.  This has brought optimism to the whole economy.

“We remain optimistic and confident that our economy is moving toward a more normal growth curve” said DBEDT Director Richard C. Lim. “We project that visitor arrivals in 2012 will reach another peak of more than 7.7 million visitors for the year. We also see a 46.2 percent increase in building permit values during the first quarter that should translate to new strength in the construction industry.”

Morgan Stanley(MS) published an analyst report on American Assets Trust (AAT) about their investor day last week saying that both retail and tourism in Hawaii has strongly improved.  American Assets Trust which owns Waikele (retail), Waikiki Beach Walk (Retail and Hotel) and the Shops at Kalakaua, has really increased revenue in 2011 and are taking aggressive steps to increase that in 2012.

The analyst at Morgan Stanley also points out that General Growth’s (GGP) Ala Moana Center is doing exceptionally well, with the two strong powerhouses being Forever 21 and the Apple store (AAPL).

The Morgan Stanley report points out strong Asian tourism gains especially from China and South Korea.

Tourism being the largest industry here drives many other industries.  With the influx of Asian tourists, we automatically see an uptick in Asian purchases of our local real estate.  They have come to buy throughout the economy downturn and recently we have seen an uptick in their purchase activity which helps support out local real estate market overall.

To learn more about our market or if you need help finding your own slice of paradise contact me, Malia Meenderman, R. Aloha!

Occupancy rates for all of Hawaii hotels stood at 67% down only 1% from this week last year.  This is a remarkable feat considering that Japanese arrivals have been down 17 to 25% since the earthquake and subsequent tsunami.  Even better news is that room rates actually rose from this time last year.  Oahu occupancy rate stood at 70.8% down 1.5% from last year and this is good news considering the vast majority of Japanese visitors stay in Waikiki.  Maui and Kauai were on average saw a 1% point increase in occupancy rates from last year.

The average room rate for the entire state was $199.48 up a huge 18.9%.  This number was driven largely by a 33% increase in rates on Maui which has much higher room rates than Oahu.  Oahu saw average room rates of $166.77 which was up 13.3% over this week last year.  This is just more proof of Hawaii’s economic recovery.

To learn more about the Hawaii real estate market contact Malia L. Meenderman, R, Bonnebaker LLC.