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Cities that Sizzle

Nation's Restaurant News, Jan, 2001

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Employers' tip-credit allowance: $3.02

State and local sales tax: 6%

Annual economIc Impact of travel and tourism: $1.8 billion

Local unemployment rate: 2.7% for Lee County

Sources: U.S. Dept of Commerce; U.S. Census Burear; Editor & Publisher Market Guide; NRN Research.

Honolulu

Wade Daniels

Restaurateurs say troubles in paradise behind them as all economic signs point to a brighter future

Most visitors view Honolulu as a place of carefree fun and sun, but many restaurateurs in Hawaii's principal tourist destination are too busy keeping the city's foodservice scene sizzling to notice.

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Though flat economic numbers in recent years and a host of new and potential regulations had put a damper on Honolulu's hospitality economy, restaurant growth trends now are looking decidedly sunny, optimistic operators insist.

With vital Asian markets showing recovery, and with hundreds of millions of dollars worth of public and private efforts being made to revitalize Waikiki Beach and attract more tourists globally, restaurateurs and industry watchers in the state capital say Honolulu finally is on the upswing.

"Beginning around 1991, the economy flattened and stayed flat, though 2000 has been quite a good year and things are on their way up," says Chuck Gee, dean emeritus of the School of Travel Industry Management at the University of Hawaii at Manoa.

And it's more than just the increasing numbers of tourists that are boosting the economy.

"Signs of [economic recovery] are almost everywhere in the Hawaii economy," writes Leroy O. Laney, professor of economics and finance at Hawaii Pacific University, in a report on the year 2000's economy. Signs include "robust job growth, falling unemployment rates, higher personal income and tax revenue growth, surging real estate sales, much stronger construction, higher hotel occupancies, fewer bankruptcies, and other indicators that local economists watch closely."

The state expects overall economic growth of 2.7 percent a year adjusted for inflation over the next five years -- which is significant for the city given that Honolulu has about 80 percent of the state's entire population.

In 2000 about 7 million visitors arrived in Hawaii, representing an increase of 4.8 percent over the 1999 number. That was a much greater growth rate compared with the previous year-on-year figure; 1999 saw only a 1.6-percent rise in visitor arrivals over 1998. About a quarter of Hawaii's economy depends on tourism, and that figure is even higher when it comes to Honolulu and its Waikiki Beach.

To remain competitive with the global tourist market, the government has been funding the expansion of Honolulu's green areas and infrastructure, such as street improvements and the widening of Waikiki Beach.

"For 15 to 20 years people acted as if God made us as this paradise place, and it didn't need any work," says Bob Fishman, chief executive of Hawaii Tourism Authority.

It is in this tourist-heavy district that some of the most dynamic development and redevelopment of the city's restaurants is taking place.

Food & Beverage Industry

Cities that Sizzle

Nation's Restaurant News, Jan, 2001

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