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The Honolulu Advertiser
Posted on: Sunday, September 10, 2006

9/11 became bookend of tourism extremes

By Lynda Arakawa
Advertiser Staff Writer

(Top) Kuhio Beach was empty in the days after Sept. 11 as hotels suffered from the lack of tourists. (Above) Fast-forward five years: You can’t keep tourists away from Waikiki Beach, and Hawai'i hotels are near capacity.

RICHARD AMBO | Sept. 7, 2006

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The five years since the Sept. 11 terrorist attacks have been full of extremes for Hawai'i's visitor industry, with its darkest days eventually leading to its best years ever.

The tourism industry suffered dramatic losses in the weeks and months after the tragic events of 2001. Airlines cut back flights, hotels were empty and thousands of Hawai'i workers lined up for unemployment benefits. The outbreak of the SARS virus and the start of the Iraq war prolonged the downturn.

But with the help of Mainland tourists choosing to vacation within the U.S., visitor arrivals to Hawai'i grew to set records in 2004 and 2005. Arrivals so far this year have matched last year's pace.

The extraordinary success has built confidence in the ability of Hawai'i's No. 1 industry to rebound from tragedy.

Still, the world changed the day of the attacks five years ago and made clear just how vulnerable the visitor industry is to events thousands of miles away. Tourism leaders, while enjoying the current boom, say they are not taking anything for granted.

"We've come back after ... real tough times for everybody in the business, and that makes the industry very resilient," said Hawaii Tourism Authority president and CEO Rex Johnson. "However, it is just extremely fragile."

Hawai'i's visitor industry has come a long way in the last five years. Immediately after 9/11, companies were laying off thousands of employees and scrambling to fill empty rooms and seats through steep kama'aina discounts. Some hotels went as far as to give guests a free night for every one they purchased. Lonely Waikiki salespeople stood outside their shops hoping to catch the few tourists who were here.

Fast-forward to today: Record numbers of tourists arrive daily. Hotels are near capacity. Deep discounts are rare. Visitor spending and hotel revenues are on track to top last year's records.

The growth is testament to how attitudes have changed in five years. Many people have grown accustomed to the realities of increased airport security procedures, arguably terrorism's most visible and lasting impact on the visitor industry.

"The effects of 9/11 changed the way we travel," said state Tourism Liaison Marsha Wienert. "The process of traveling is no more the easy traveling mode that we once knew, and as an economy that is dependent on tourism, those security requirements are ones that we contend with every day."

Still, travelers have accepted the security changes and heightened alerts, and are boarding planes anyway.

The latest example was last month, when London authorities thwarted an alleged terrorist plot, prompting airports to ban passengers from carrying liquids and gels onto planes. Some hotels reported a slight drop in reservations for a few days that week but said business quickly returned to normal.

That spoke to the resiliency of travelers, said Peter Shaindlin, chief operating officer of Halekulani Corp.

"Despite the huge implications of their activities, travel is as strong as before (the London plot) happened," Shaindlin said. "Five years ago, this would not have been the case."

At the same time, the tourism industry also has become more conscious of security issues in ways it never was before, officials said.

"In the last five years, these events have inspired the industry to completely revisit their standards for safety and security for hotel guests," Shaindlin said. "And that runs not only from the practical operational side but runs right through the matter of confidentiality of information."

Hawai'i's advantage in the recovery has largely been its image as an exotic leisure destination with the safety and conveniences of being part of the U.S. Just weeks after the 2001 attacks, there were reports that some Mainland travelers canceled European vacations in favor of Hawai'i, which they viewed as safer. Recent disasters such as the hurricanes in Florida and on the Gulf Coast, the devastating Indian Ocean tsunami, and terror attacks in destinations such as London and Madrid may also have steered more visitors to Hawai'i.

That more Mainland residents chose to travel within the U.S. helped Hawai'i recover, but it also made the local industry heavily dependent on U.S. visitors. The downturn pushed the industry — especially on O'ahu — to work on expanding its customer base as Japanese travel here fell, and companies looked not just to the West Coast but to U.S. East visitors, Wienert said.

The Sept. 11 attacks also prompted strict new visa rules, affecting foreign markets that tourism leaders are trying to nurture suchas South Korea and China, Wienert said.

Sept. 11 had another effect on travel. After the tragedy, families wanted to spend more time together on trips and have more meaningful, even spiritual, experiences on their vacations, tourism leaders said.

"It helped people realize the importance of families," said Keith Vieira, senior vice president and director of operations for Starwood Hotels & Resorts in Hawai'i and French Polynesia. "It helped people realize the importance of rejuvenation in travel."

More families — including extended families — are taking trips together, and not just during school breaks. There's also more interest in outdoor activities such as diving, snorkeling, kayaking and hiking, Vieira said.

"They are much more experiential and activity-related," he said.

Immediately after 9/11, Hugh Montgomery and his wife thought their Big Island hiking-tour business, Hawaiian Walkways Inc., was going to go under. Montgomery noted that the attacks were quickly followed by the bankruptcy of the interisland cruise line American Classic Voyages. It took probably about five months for him to feel "reasonably optimistic again," he said.

But Norwegian Cruise Lines' Norwegian Star soon began sailing the Islands, "and it's been steady growth for us ever since," he said. Hawaiian Walkways has grown from about four employees five years ago to 17 today.

Montgomery is feeling "pretty confident" about the business, but is well aware of how vulnerable the industry is.

"It's just that there are so many possible impacts on tourism," he said. "No matter what happens, tourism is a fickle business."

In the meantime, Hawai'i's visitor industry is closely watching issues that could potentially affect tourism's future, including situations outside the U.S.

"If you look at Hawai'i's past, outside of a major incident, i.e., 9/11 or SARS, two or three things have to compound for there to be a major change," Vieira said. "I think certainly Middle East unrest and what that means for the world will probably be our No. 1 concern because that does tie back to fuel costs. It does tie back to how safe people feel."

Vieira also said the global economy and airlines are key factors in the future of Hawai'i's tourism industry.

And although it's clear the travel industry has proved its ability to bounce back, the shadow of the tragedy five years ago still lingers.

HTA's Johnson said he heard a tourism director from another state say he didn't feel comfortable flying on the fifth anniversary of 9/11 to attend a tourism meeting in Washington, D.C.

"There are some thoughts about that type of stuff out there," Johnson said. "We're not going to forget this."

Reach Lynda Arakawa at larakawa@honoluluadvertiser.com.

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