Low interest rates and cheaper gas prices are putting more money in consumers’ pockets.
Falling unemployment is helping reduce debt.
And the state’s No. 1 industry, tourism, is coming off what should be a third straight record year when the 2014 numbers are announced later this month.
All that helped contribute to a 7.4 percent increase in credit and debit card sales during the fourth quarter at businesses open at least a year, according to First Hawaiian Bank’s quarterly business activity report due for release Sunday.
Card transactions have now increased for 20 straight quarters over the year-earlier period dating back to when the bank began producing its reports at the start of 2010.
"The economy continues to grow," said Bob Harrison, chairman, president and chief executive officer of First Hawaiian Bank. "Lower energy costs will continue to help the customer because they’ll be spending less on electricity. That will give them more disposable income, which will be good for the rest of the economy. This report is a really good reflection of consumer confidence."
First Hawaiian, the largest bank in Hawaii with $18.1 billion in assets, is able to track the economic pulse of the state through its card processing services. The bank is the largest local processor of debit and credit card transactions in the state; it has nearly 7,000 merchants on its network, with most of those in Hawaii.
Hotel card transactions, virtually flat in the first quarter with a 0.3 percent decline, trended up during the final three quarters of 2014 and finished strong with sales up 18.2 percent in the October-December period. That gain topped the 16 sectors tracked by First Hawaiian and marked the second straight quarter that hotels topped the list.
At the Trump International Hotel Waikiki Beach Walk, guests have continued to flock to the 38-story luxury condominium building where 300 of the 462 units are in the hotel rental program.
Card transactions for Trump rooms were up 24.3 percent in the fourth quarter over the year-earlier period as hotel occupancy for the year exceeded 80 percent, according to John Votsis, director of sales and marketing for Trump Waikiki.
In 2006 it took just 7 1/2 hours for Trump to sell all of its condos when they were put on the market. The luxury hotel opened three years later.
"We’ve gained (in revenue) every month over the previous year’s quarter," Votsis said. "We’ve grown our hotel from zero to 60 (mph) in a very fast time. When we opened up toward the end of the recession in November 2009, we were the first new hotel in Waikiki in 25 years. Although some had renovated, we were the first newly built hotel since 1984.
"When you’re the newest on the block, you get more attention, and I think we’ve delivered on the service end. … You can’t just say you’re a luxury hotel without delivering the luxury."
The hotel offers three restaurants, 24-hour room service, valet parking, complimentary Wi-Fi and twice-daily housekeeping services.
Through the first 10 months of 2014, more than 25 percent of Trump Waikiki’s guests were repeat visitors, Votsis said.
"That’s pretty good for a five-year hotel," he said.
Nightly condo rentals for studios; one-, two- and three-bedroom units; and larger penthouses range from $450 to $4,000 depending on the season, Votsis said. The square footage of those units range from 400 to 3,000 square feet.
Hotels were one of five sectors to have double-digit increases during the fourth quarter over the year-earlier period, according to the report. Other big gainers were shipping (14.5 percent), supermarkets (14 percent), convenience stores (13.6 percent) and home furnishing (11.1 percent).
Overall, total card volume for the 16 sectors was $763.8 million compared with $711 million in the year-earlier quarter.
For the full year, home improvement was the only double-digit gainer with a 14.3 percent increase.
"There’s no doubt that many people have taken advantage of loans to do renovations and various things around the house," Harrison said. "With interest rates being low and home equity increasing, it allows more people to borrow on a value basis and gives them more borrowing power to do a home renovation."
Hotels, primarily due to a slow first quarter, ended 2014 with the sixth-largest sales increase at 8.4 percent. Total card transactions for businesses open at least a year in the 16 sectors rose 6.2 percent in 2014 to $3.03 billion from $2.85 billion.
Harrison expects continued improvement this year.
"Construction employment has gone up, and a lot of projects are going up in Honolulu," Harrison said. "We see further strength in 2015. For the Japanese visitor, the yen has weakened considerably over the last 12 months, but they’re still coming to Hawaii. We’re still optimistic for another strong year. I think the strong economy will certainly help the mainland visitors to Hawaii as well."
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