HANMI: Hotel occupancy up slightly in September

Major hotels in the CNMI are seeing a slight jump in occupancy at a time when many are struggling due to the rising cost of doing business on the islands, the Hotel Association of Northern Marianas Islands reported in statistics released Monday.

In September, the 14 member hotels in the association saw an average rate of more than 55.14 percent occupancy, roughly 6 points higher than the same month last year, which had one of the lowest occupancy rates on record at an average of just over 49 percent.

Association chairwoman Lynn Knight said that in spite of the increased occupancy, hotels in the CNMI are still facing a host of serious challenges linked to the economic downturn here, on the American mainland and abroad. Rising operational costs, she added, have only made the circumstances more difficult.

“While the Association welcomed the slight increase in occupancy, we are closely watching the changing American and world economies and how the cooling may affect local tourism,” said Knight. “Other rising costs of doing business, including increases in utilities, fuel, labor, shipping, food and other commodities are putting continued pressure on the industry.”

Responding to tough economic times, hotel room rates have also risen in the last year from $85.35 on average per night to $89.22, HANMI said in a statement.

The Association noted that costs in the CNMI are quite a bit higher than Guam, yet the hotels need to maintain similar pricing in order to compete effectively. Additionally, the effects of a weaker won are affecting the Korean tourism market, one of the fastest-growing markets for the CNMI due to the commitment of Asiana Airlines to increasing flight schedules and marketing.

This year to date, it added, HANMI member hotels have paid over $2.4 million in gross receipts tax and $4.8 million in hotel occupancy tax to the government.

The increase in occupancy comes after the Marianas Visitors Authority earlier this month released statistics showing a modest 5 percent increase in visitor arrivals to the CNMI for September linked to the expansion of airline service to Saipan from Japan. Despite this jump, tourist visits to the CNMI appears on a plateau. Only 474 more travelers came to Saipan in fiscal year 2008, which ended in September, than in the previous year.