The daily number of trans-Pacific arrivals jumped as Hawaii launched a pre-arrival testing program to welcome travelers back. Now, a week after the state’s tourism reopened, visitor arrivals have already begun to level off.
The number of visitors coming on vacation or to visit friends stood at 463 on October 14, the day before Hawaii launched its pre-arrival testing program that gave travelers the option to bypass around 40 visitors of 14 days. That number peaked at 5,124 on Saturday, but by Tuesday it had fallen more than 48% to 2,637.
Hawaii visitor industry leaders credit pent-up demand for the better-than-expected number of travelers who came for the program’s launch ahead of arrivals. Now they say visitor arrivals are approaching the 2,000 to 4,000 a day the industry had predicted, or even less.
“The early days were robust, but it’s tapered off,” said Jack Richards, president and CEO of Pleasant Holidays, a Hawaii-based travel wholesaler. “I would describe the reopening as hectic.”
The University of Hawaii’s Economic Research Organization said it does not expect to see a meaningful economic recovery until the middle of next year, and a muted recovery period thereafter.
“The long-term expectations for recovery are so far off,” said Keith Vieira, KV & Associates director, Hospitality Consulting. “Most of the hotels in Hawaii that have reopened are only operating at around 15% to 20% occupancy, and that’s without the entire hotel supply being reopened. Performance is still marginal at 50% hotel occupancy and that’s the best most Hawaiian hoteliers can even hope for right now.
It’s a sign of the times that despite the reopening of tourism in Hawaii, The Street food hall – celebrity chef Michael Mina’s casual dining concept in the International Market Square – announced on Wednesday that it will close on November 11. 8.
The Street — its full name is Michael Mina’s The Street Food Hall — opened in 2017 in a 12,561-square-foot space on the ground floor of the market. It houses 11 food stations offering an international selection of cuisines. The street currently employs some 115 people, according to a worker adaptation and retraining notice filed with the state in late September.
Scott Suemoto, Mina Group’s sales and marketing director, said the food hall was built around communal dining, a pattern unsustainable under social distancing restrictions.
The Street offers a consolidated take-out menu featuring bestsellers from the various stations, as well as items from Mina’s Stripsteak Waikiki, located upstairs in the market. The street was able to open for seated service between the two dining stops, Suemoto said.
But the second shutdown put the food hall in a critical position, he said. “It made it impossible to recover months and months and months of lost revenue.”
Mina also owns Mina’s Fish House in the Four Seasons Resort Oahu in Ko Olina. Suemoto said the company hopes to reopen Stripsteak and Fish House soon.
Real estate analyst Stephany Sofos said many Hawaiian businesses are “just hanging on” and for some the reopening of tourism is too little too late.
“I’m sure by the time The Street closed they were trying to make it work and couldn’t even make it anymore,” Sofos said. “Waikiki was built to accommodate over 10 million visitors and it will be years before we get close to that number again. It’s very sad, but I’m sure we’re going to see a lot more companies in trouble – and some of them will have to give up.
To be sure, Hilton Hawaiian Village, Hawaii’s largest hotel property, filed an amended WARN notice with the state on Oct. 15, the same day Hawaii’s pre-arrival testing program kicked off. Julie Walker, Hilton’s regional director of social services, said in the notice that the company was potentially extending furloughs over the past six months for 1,880 employees and that from December 13 it would begin permanently laying off 55 employees.
Walker said the lockdown orders have significantly disrupted travel and commerce.
“For example, the state recently announced that travelers to Hawaii from out of state must take a COVID-19 test with negative results within 72 hours of traveling to Hawaii,” Walker said. in the WARN notice. “If travelers do not comply with the testing requirement, they are required to self-quarantine for 14 days. Contrary to our expectations, government orders continue to place substantial limits on our operations at this location (such as social distancing guidelines, limits on large public gatherings, and capacity limitations).
Ben Rafter, president and CEO of Springboard Hospitality, which has 35 hotels in Hawaii and eight other states, said he doesn’t expect to see further recovery for Hawaii’s hospitality industry until late December. , early January at the earliest.
“Right now, Hawaii has the worst performing hotel markets in the United States,” Rafter said. “Drive-in markets hotels that have reopened like Napa, California; Park City, Utah; and Jackson Hole, Wyo., are doing well. Hotels in urban markets are about 30% occupancy. Once Hawaii reopens further, I think we will come in behind the car markets, but ahead of the urban markets.
In September, Oahu had a hotel occupancy rate of 21.3%, the lowest among the nation’s top 25 hotel markets and the only one with an occupancy rate below 30%. The top performing hotels on the list were Norfolk/Virginia Beach at 56.8% occupancy and San Diego at 54%, Los Angeles at 53.8%, Atlanta at 49.2% and Detroit at 49.1%.
Honolulu Star-Advertiser Crave editor Betty Shimabukuro contributed to this story.