Hawai'i's hotel occupancy fell sharply in January from the same month a year ago, although hotel room prices continued to climb, according to a report released today by Hospitality Advisors LLC.

Statewide hotel occupancy fell by 6.3 percentage points in January to 74.4 percent, mirroring a decline in visitor arrivals reported last week, said Hospitality Advisors President Joseph Toy. But he said a rise in the average daily room rate to $198.30 helped bolster hotel revenue.

The state's highest room rates were at Wailea, Maui, and the highest occupancy — also on the Valley Isle — in the Ka'anapali-Kapalua area, Toy said.

He said growth in the hotel industry is beginning to show some signs of moderating after four successive years of record room revenues.

"We are definitely in the down cycle of the trend," he said. Hotels can be expected to wait and see if the fallout continues.

If it does, Toy said, Hawai'i resorts would likely respond by creating "value packages" to help cushion any falloff, offering such deals as free nights to people who stay several nights or free breakfasts or dinners.

Occupancy at Waikiki hotels operated by Starwood Hotels & Resorts edged lower, providing more evidence of a softening market, said Keith Vieira, senior vice president and director of operations for Starwood in Hawai'i and French Polynesia.

"There was a flattening for the U.S. market and a continued decline in the Japanese market," Vieira said. "There's no doubt that we are very concerned."

Mark Simon, director of the Four Seasons Maui Resort at Wailea, said his hotel may part from the trend in recent months because it is wrapping up a $50 million renovation.

With fewer rooms available right now, Simon said, there hasn't been a significant decline.

But looking at the statewide numbers is cause for concern. "Generally speaking, it's certainly an indicator that catches our attention," he said.

Simon said he sees no particular reason for visitors skipping Hawai'i. He's heard some speculation that travelers who were skipping Europe or other destinations may now be going there and bypassing Hawai'i.

"It's probably a temporary thing," Simon said.

The survey, compiled by Smith Travel Research with Hospitality Advisors, included 144 properties representing 46,254 rooms, or 79.5 percent of all lodging properties with 20 rooms or more in the state, including full-service, limited- service and condominium hotels.

Reach Robbie Dingeman at rdingeman@honoluluadvertiser.com.