Average daily room rates, a key industry measure, also increased, by 3.2 percent over the previous September to $138.77.

"It's just been an outstanding year for Hawai'i," said Hospitality Advisors president Joseph Toy. "We haven't set a record in room nights sold, but we are closing in on revenues generated."

Toy said weekly figures through this month point to a fairly strong fall shoulder season, which is anticipated to give the industry momentum for a favorable first quarter next year.

For the year through September, Hawai'i hotels brought in $2.09 billion in room revenue, a 12 percent increase over the same period last year. It's the second-highest room revenue figure recorded for the first nine months of the year, behind September 2000 year-to-date revenues.

September hotel occupancy rates improved on every major island except Kaua'i, whose numbers slipped by 1.4 percentage points to 76.3 percent. Every island saw increases in daily room rates, with Maui achieving the highest at $168.25, a 4.8 percent increase over the previous September.

All categories of hotels — from budget to luxury — saw higher occupancy rates and charged higher average room rates compared to the previous September. Budget hotels posted the highest occupancy rate at 80.4 percent, while midprice hotels had the lowest at 72.4 percent.

"In terms of how things have been for the last decade, it's tremendously encouraging to see the strength in the market this fall," said David Carey, chief executive officer of Outrigger Enterprises Inc.

"I don't know whether we're shell-shocked from several tough years, but it exceeded our expectations for September," he said.

Carey noted a strong U.S. East market and the return of Japanese travelers, who are looking more at lower-priced hotel categories than they used to.

Keith Vieira, senior vice president of Starwood Hotels & Resorts Hawai'i, said Starwood properties have seen hotel occupancy increases, and that overall he's very happy with the year-to-year growth. But he tempered the news with some caution.

"People can't forget we are basically still very close to 2000 year numbers in revenue, but add five years of expenses," he said. "So while our revenue numbers are good and we're probably back to pre-9/11 revenue numbers, we are years behind in profitability."

Toy also said that while the hotel numbers are good news, those in the industry are still cautious. Travelers are still not booking rooms as far in advance as they used to, he said.

"Overall the U.S. travel market is still recovering and so we have to be mindful of that," he said.

For the year-to-date, statewide room demand rose by 7.3 percent to 13.9 million room nights sold. That figure, however, is less than the record 15.16 million rooms sold in 2000.

Hawai'i hotel occupancy increased 6.1 percentage points to 79.2 percent for the year through September, the highest for the period on record since the survey began in 1988. But the record occupancy largely reflects reduced hotel inventory following hotel conversions to condominiums and time-share units.

Hawai'i's year-to-date hotel occupancy and average daily rate — $151.13 — came in second to New York City among the top 25 hotel markets in the nation. New York's occupancy and average daily rate were 80 percent and $174.18, respectively.