Harbor business 'as bad as it gets' in Wai'anae area

By Will Hoover
Advertiser Leeward O'ahu Writer

Keith Lum stood alone on the deck of his boat at the Wai'anae Boat Harbor and wondered what, if anything, he could do to lure back the customers he had before Sept. 11.

The tour boat "Northern Express" enters Wai'anae Boat Harbor with its full-day load of nine tourists. Before Sept. 11, Keith Lum, the boat's captain, said he averaged 27 passengers, twice a day Bruce Asato • The Honolulu Advertiser

As the harbor goes, so goes Wai'anae. And the community, economically beleaguered in the best of times, is suffering along with the dozens of small fishing boats and the harbor's charter boats — fishing, scuba and whale-watch tours — that have depended primarily on Japanese tourists for their livelihood.

There have been layoffs at some businesses; others are struggling to stay in operation. Several stores at Wai-'anae Mall may lose the battle, and just about everywhere, owners are cutting expenses and hoping things will improve.

"We're always in survival mode," said William Aila, Wai'anae harbormaster. "But this has been as bad as it gets."

Lum's boat, the "Northern Express," a 37-foot dolphin and whale-watch boat own-ed by DolFun, carries up to 39 passengers. Lum said before 9-11 he was averaging 27 passengers, twice a day.

On Wednesday, Lum called it a day after one boat load of nine passengers. Two of those passengers were Japanese, he said. Before September, 85 percent of his business was Japanese.

"I don't think we'll get past this year," said fishing charter boat captain Hank Chase, who has operated out of Wai'anae for the past 15 years. "Before the World Trade Center attack, I was doing between $3,000 and $7,000 a month. October was a disaster. In November I did $900. That's gross! Doesn't include overhead. December was just as bad as November, and so far this month I've done about $600.

"I've got my boat up for sale."

Fewer tourists has meant fewer charter boat customers patronizing the harbor and area shops and businesses. At the same time, a decline in tourists has meant a decline in the demand for fish at hotels and restaurants across the state. Thus, the price of fish has gone down, which, in turn, has resulted in fewer small-boat operators coming to Wai'anae.

Aila said normally more than 60 percent of O'ahu's small commercial fishing boats set sail from his harbor.

"It has affected my business a lot," said Boyd Kaneshiro at Boyd's Fish Market in Nanakuli. "This area has a low-income population. A lot of my customers out here are on welfare and don't have the money. And the ones that do have jobs, they aren't spending either. Everybody is in a 'don't spend' mindset right now.

"I haven't had to lay anybody off, but I've had to cut back on expenses. So, yes, on this side of the island things are still down because of September 11."

At Wai'anae Mall, several businesses are on the brink. Byron Iha, manager of Save-A-Lot Food Stores, said because his market is part of a national chain, a portion of his customer base was tourists who were familiar with the operation.

Since Sept. 11, Iha has had to lay off five employees and cut back store hours. He pointed to a chart on his office wall that showed revenues doing nicely through August 2001. At that point the graph does a nosedive.

"There was a $36,000 drop in September and around $25,000 in November," he said. "With those kinds of numbers the president of the company called in December and said, 'I don't think we're going to make it.' Unless things pick up, we'll probably close in August."

Lani Na'auao said business was good at his Uncle Lani's Poi Pub & Eatery during its first year. Then came 9-11.

"We've dropped off 50 to 60 percent since then," said Na'auao. "It's a family-owned operation, and we've got two employees we haven't had to lay off. We're trying to hang in there."

In early 2001, Aila forecast increased earnings in the coming year for his charter boats. But the post-Sept. 11 downturn was so extreme, business in 2001 ended up down $100,000 from the year before. The harbor now accommodates 11 charters. In 2000, there were 15.

"We don't have a lot to offer economically," said Ed Nelson, former vice president of the Wai'anae Boat Fishing Club. "It's a struggle out here even when we're not in a recession. And the harbor is kind of the centerpiece of Wai'anae."

For charter boats that have not relied on Japanese visitors, the picture has not been so bleak. Mike Axelrod, who operates the South Seas II, a 38-foot dive boat, out of the harbor, said his business has rebounded after a 50-percent drop immediately after Sept. 11.

And Victor Lozano, owner of Dolphin Excursions Hawai'i, predicts 2002 could be his best year yet. Lozano, who has owned the company for three years and has had extensive experience running boat tours for other operators, said he has built his business around visitors from the U.S. Mainland.

"A lot of companies have been spoiled by the eastbound market," said Lozano. "People from Japan don't complain, they don't sue and you don't have to take them out for as long. Mainland visitors complain, sue and want longer tours. But I know what these people want. I give good service. I have some who've been back 15 times."

Lozano has also focused on a market he said others have ignored: the local market.

"I own it," he said. "No one else was paying attention. Whales attract local people."

Aila, who describes Lozano as "the poster child for how to ride out the 9-11 storm," said Lozano goes out two to three times a day, seven days a week, works every angle, has resisted lowering his prices, attracts business off the Web and knows how to self-promote.

Lozano is unusual in that he captured a niche that hasn't deserted the Islands to the same extent as the Japanese market has, Aila said. Aila also contends that the worst of 9-11 is behind charter boat operators at the Wai'anae Boat Harbor.

"It has never been this bad," he said. "You've hit bottom, though. So, there's no place to go except up.

"That's the optimistic viewpoint, I guess."

Reach Will Hoover at whoover@honoluluadvertiser.com or 525-8038.