Maui's CRE Marketplace Begins to Stabilize
After facing a short COVID-19 pandemic-initiated recession in 2020, Maui’s economy posted a 2,500 job gain during the past year as the island’s unemployment rate decreased to 6.3% for December 2021. This is its lowest level since Maui’s government-mandated economic shutdown that started in March 2020 and since peaking at a record high 34% jobless rate in April 2020.
Much of this job growth resulted from a rebound in retail and accommodation positions during the past year. Maui’s jump in air passenger arrival counts, which nearly tripled in size from 791,700 to 2,296,276 during the past year, elicited rehiring efforts. Correspondingly, Maui’s hotel occupancy rates improved strongly from a year-to-date (“YTD”) December 2020 level of 34.6% to 60.2% for 2021. As a result, the average daily room rate jumped 31.1% to $536.17, and revenue per available room surged 128% to $322.70. Additionally, this surge in visitors produced $4.1 billion in visitor expenditures, which boosted retail sales and prompted many retailers to rehire employees.
The COVID-19 Omicron variant’s infection rate that surged during the end of 2021 and into January 2022 appears to have peaked. As a result, Maui County has lifted several travel restrictions and dropped requirements for patrons of bars, gyms, and restaurants to provide proof of vaccination or negative COVID-19 tests for indoor service. The island’s retail, travel and hospitality sectors will benefit from this change and hopefully, continue to recover from the dramatic downturn in visitor expenditures during the past two years.