Hawai'i's hotel business continued growing at a record-breaking pace last month, during what is traditionally tourism's slower season.

Average daily room rates statewide set an October record of $159.67, up 12.4 percent over the same month last year, according to hotel consultant Hospitality Advisors LLC.

Revenue per available room, a key measure of profitability, also set a monthly record at $126.98 statewide. Statewide hotel occupancy was 79.5 percent, up 2.6 percentage points from October 2004.

"We couldn't be more pleased," said Kelvin Bloom, president of ResortQuest Hawaii.

"For both the year as well as for the month of October, the demand has been exceptional, thus allowing us to be more vigorous with room rates," he said. Bloom said the restricted room supply in Waikiki and continued improvement in hotels contributed to "favorable" growth in revenue per available room. Neighbor Island properties also saw growth in revenue, he said.

Hawai'i's hotel industry is on pace to beat last year's room revenue record of $2.73 billion and is expected to reach $3 billion by the end of the year. Room revenue through October is $2.5 billion, more than 10 percent higher than the same time last year.

The higher room revenue is driven more by rising rates than room sales, said Hospitality Advisors president Joseph Toy. Room nights sold through October are just 1.7 percent ahead of the same period last year, he said.

Room revenue for October is almost 12 percent higher than the same month last year, despite rooms sold being slightly behind, Toy said.

Toy and Bloom said rates will probably continue to increase next year, but at a more moderate level.

"It's definitely a very, very strong shoulder season," Toy said. "Because we're at such high peaks, we have a lot of displaced demand going into the shoulder season, so the shoulder season tends to fill in, and that's what we're seeing."

Upscale properties posted the most gains in the market, although all hotel categories posted year-over-year improvements in occupancy, average daily rates and revenue per available room. Growth in higher-spending visitors such as business travelers also contributed to solid gains among luxury hotels.

O'ahu's hotel occupancy of 84.7 percent topped the state average, followed by Maui (77 percent) and the Big Island (69.2 percent). Kaua'i was the only major island that saw a drop in occupancy, falling 4.3 percentage points to 75.8 percent.

Still, all islands posted growth in average daily rates and revenue per available room.

The monthly hotel survey, compiled by Smith Travel Research with Hospitality Advisors, averaged more than 141 properties representing approximately 48,383 rooms reporting, or 79.5 percent of all lodging properties with 20 or more rooms in the Islands.

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