NOW ON THE HOT SEAT: David Carey, president and CEO of Outrigger Enterprises
July 8th, 2008 by Jeanne Mariani-BeldingWelcome to The Hot Seat. Joining us live today from noon to 1 p.m. is David Carey, president and CEO of Outrigger Enterprises.
Outrigger, one of the largest privately-held leisure lodging companies in the Asia Pacific region, recently saw a drop in local bookings and is bracing for the months ahead, as rising fuel costs continue to take its toll on the economy. And any dramatic drop in tourism, the ripple effect on our economy extends far beyond Waikiki, to the businesses and workers that count on tourist dollars to survive.
Outrigger Enterprises also recently completed its Waikiki Beach Walk, the major $535-million revamp of the area bordered by Kalakaua Avenue, Lewers Street, Kalia Road, Beach Walk and Saratoga Road, with 40 new retail shops, outdoor entertainment, restaurants and more.
Just a reminder of our Hot Seat ground rules: Please keep your questions concise and on point so that we can get to as many questions as possible; and keep it civil, no personal attacks please.
Ready? Let’s chat.
July 8th, 2008 at 12:09 pm
Let’s get started with this question sent via e-mail from Colin:
It seems that our business community is not too worried about the economy, while people, including tourists struggle to deal with fuel, higher food costs and more. What’s your take on the economy as it relates to the visitor industry here? What can be done? Do you plan layoffs like other companies in Hawaii?
July 8th, 2008 at 12:17 pm
And here’s one sent in earlier from Donna:
With the drop in tourism, what’s your strategy for making the Beach Walk profitable?
July 8th, 2008 at 12:19 pm
Thanks for the chance to share my thoughts.
To answer Colin’s question, I am very concerned about the near term of tourism. The downward economic trends have always negatively affected Hawaii’s business. Fuel costs are a big issue.
Here’s an analogy I like to use. If you have $2 a gallon gas that suddenly jumps to $4 a gallon, it’s shocking but you still have to drive to work. So, begrudgingly you grin and bear it. But, if the cost of airfare for a trip to Hawaii from the west coast goes from $500 to $1000, you may or may not want to bring your family to Hawaii until the price is right. With time, consumers may get used to higher airfare prices—but for now there is bound to be some disruption in our tourism market.
This will likely lead to a drop of 10 to 15% drop in business. Handling it will be tough.
July 8th, 2008 at 12:23 pm
And here’s one sent in earlier from Donna:
With the drop in tourism, what’s your strategy for making the Beach Walk profitable?
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Part of the strategy will be to continue to work with the HTA and the various visitor marketing agencies to promote the great things we have in Honolulu, particularly Waikiki Beach Walk.
The other part of the solution will be to continue to make Waikiki Beach Walk a welcome place for those of thus that live here in Hawaii. Waikiki Beach Walk has been extremely successful. What makes me the happiest is the fact that — one, residents have come down to explore and enjoy Waikiki’s newest shopping, dining and entertainment district, which has turned out to be both a tourist and a local hangout; and two, we have been successful in incorporating a lot of the Hawaiian cultural aspects into Waikiki Beach Walk, not only in the general design of the space but in the music and entertainment we have been able to bring to Waikiki with our Na Mele No Na Pua Hawaiian musical heritage program. We believe that some people that may not choose to travel to the mainland will stay home and have some fun.
July 8th, 2008 at 12:23 pm
Here’s another one sent in from Tyler:
Mr. Carey,
I never go into Waikiki. Too much traffic too congested. I know other locals feel the same. What can you and other businesses do to make Waikiki, including Beach Walk, more attractive to local residents?
July 8th, 2008 at 12:28 pm
Here’s another one sent in from Tyler:
Mr. Carey,
I never go into Waikiki. Too much traffic too congested. I know other locals feel the same. What can you and other businesses do to make Waikiki, including Beach Walk, more attractive to local residents?
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In reality, Tyler, we actually have made big improvements in parking and traffic. In Waikiki Beach Walk, for example, we added more than 200 new parking stalls and have a seamless valet parking system. Outrigger and other businesses have focused on moving deliveries off the streets and into loading areas. The results have been very good, particularly on Lewers.
The Yard House and other restaurants have finally given locals real choices full of good food and entertainment. We have regularly entertainment schedules with entertainers on the Waikiki Beach Walk plaza and have other entertainers in the restaurants and hotels. The Na Mele Music series has featured many of Hawaii’s top talent.
July 8th, 2008 at 12:30 pm
I understand Outrigger is expanding internationally - what countries will you be opening properties in?
July 8th, 2008 at 12:32 pm
Here’s one posted earlier from Chris:
Aloha Mr. Carey,
Any chance of bringing Hawaiians and a Hawaiian feel back? This is what the tourists seek but find something else when they arrive.
Strong recruitment of local cultural practitioners and Hawaiian incorporation into every aspect of the hotels would attract a strong tourist base despite the poor economy. It would also attract many locals as well.
July 8th, 2008 at 12:33 pm
Affordable parking in Waikiki has been a problem for us, is there anything in the plans to fix this?
July 8th, 2008 at 12:33 pm
Here is a question from Bill:
I understand Outrigger is expanding internationally - what countries will you be opening properties in?
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We expect to open in Thailand, Bali and in places like Hainan Island China. We also will be re-establishing our presence in Australia and New Zealand. We have been steady in Guam and Fiji. In spite of the growth, however, our home is still Hawaii.
July 8th, 2008 at 12:37 pm
Here’s one from Richard, a member of our Community Editorial Board:
What impact will the new Chinese visitors have on tourism and the economy?
July 8th, 2008 at 12:38 pm
Here’s one posted earlier from Chris:
Any chance of bringing Hawaiians and a Hawaiian feel back? This is what the tourists seek but find something else when they arrive.
Strong recruitment of local cultural practitioners and Hawaiian incorporation into every aspect of the hotels would attract a strong tourist base despite the poor economy. It would also attract many locals as well.
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We have done much to encourage the renaissance of Hawaiian culture at Outrigger. We have been working on our cultural value process we call Ke ‘Ano Wa’a or the Outrigger Way for more than ten years. It was inspired by Dr. George Kanahele and is about teaching Hawaiian hospitality and culture throughout our system. We have also strongly support cultural and entertainment programs throughout our properties. All of our renovations have endeavored to reflect a Hawaiian sense of place. Our efforts have been well received by tourists and locals.
July 8th, 2008 at 12:39 pm
just curious as to what percentage of hospitality employees are paid a livable wage? seems like a lot of funds and promotion go into tourism. i have an aunty who works three jobs in order to support her kids. she tells me when she was younger, they worked less.
July 8th, 2008 at 12:42 pm
A question from Prescott
Affordable parking in Waikiki has been a problem for us, is there anything in the plans to fix this?
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We have worked to make parking as easy and affordable as possible, but the reality of the cost of doing business in Waikiki makes it impossible to make it free. We are always thinking of specials and programs for our Kamaaina friends, for example, weekday lunch parking is free at Waikiki Beach Walk with a restaurant validation.
July 8th, 2008 at 12:44 pm
And here’s one sent via e-mail from Delia in Waikiki:
I have lived in Waikiki for more than 20 years. Please ask David Carey what share of the visitor lodging Outrigger has? Also, what does his company do to minimize that impact, or in terms of helping the community that has to live with the tourism and the noise?
July 8th, 2008 at 12:46 pm
Here’s one from Richard, a member of our Community Editorial Board:
What impact will the new Chinese visitors have on tourism and the economy?
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With the softening of tourism from North America and Japan, there will be ample room for the growing Chinese (and Korean) markets. What is exciting about this market for Outrigger is so many of our employees have strong Asian ties and are looking forward to the opportunity to provide our Ho’okipa to our new guests.
July 8th, 2008 at 12:49 pm
And here’s one from Kyle:
The economic trouble has made it clear to me there does not seem to be a long term economic plan to make sure our tourism is vibrant in the future. What is your longterm plan for this for Outrigger? Did you change that plan due to the fuel costs and the impact on our economy?
July 8th, 2008 at 12:50 pm
This one comes via e-mail from T-Rex:
Can you ask Mr. Carey to tell us what his background is? Does he have roots in Hawaii and does he consider this home? If so, what are his thoughts on things that can be done, locally to improve the economy, schools and other networks that make a community successful?
July 8th, 2008 at 12:51 pm
Posted by Randy:
just curious as to what percentage of hospitality employees are paid a livable wage? seems like a lot of funds and promotion go into tourism. i have an aunty who works three jobs in order to support her kids. she tells me when she was younger, they worked less.
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Randy you have hit on a tough problem we all face. Hawaii is an expensive place to live. The price of paradise is indeed high. Having said that, I think most people would be pleasantly surprised at how well hospitility employees are paid. Our housekeepers make nearly $14 and hour with a very rich benefits package. In addition, at least in our company, people have a great opportunity to grow into higher positions as well.
July 8th, 2008 at 12:57 pm
And here’s one sent via e-mail from Delia in Waikiki:
I have lived in Waikiki for more than 20 years. Please ask David Carey what share of the visitor lodging Outrigger has? Also, what does his company do to minimize that impact, or in terms of helping the community that has to live with the tourism and the noise?
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Delia, good question. Outrigger manages not quite 10% of the total visitor inventory in and around Waikiki. This issue of impact can be looked at in other ways. We provide an enormous number of jobs for local residents. The noise can be a problem, but many of our visitors also appreciate the action and vitality of Waikiki. An urban resort may not be like the North Shore, but many love the city experience.
Where we can we help the Waikiki community through organizations such as the Waikiki Community Center. All of the hotels provide direct support to local charities though the Visitor Industry Charity Walk.
We and other also support the Waikiki Business Improvement District, which helps clean sidewalks, waters plants and keeps an eye on safety of residents and tourists.
July 8th, 2008 at 1:01 pm
This one comes from John K:
How would you describe the changes in the tourism industry in the last 30 years? Is Hawaii being over run by other international destinations?
July 8th, 2008 at 1:01 pm
And here’s one from Kyle:
The economic trouble has made it clear to me there does not seem to be a long term economic plan to make sure our tourism is vibrant in the future. What is your longterm plan for this for Outrigger? Did you change that plan due to the fuel costs and the impact on our economy?
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Part of our plan has been to continuously improve our product so that we will be more attractive to today’s international customers. I see support to our markets from Asia in addition to our traditional markets, but there may be periods when business is not as strong as we would like. With a national slowdown in the US, many places will see a slowdown.
Given that Hawaii has such great people and if the private industry and governement keep our physical plant up to date, we will get our fair share.
July 8th, 2008 at 1:03 pm
Here’s another one sent in via e-mail from Greg:
What are you future investment plans in Hawaii? How would you describe the hiring landscape for your young people looking for jobs in the visitor industry and what advice can you share?
July 8th, 2008 at 1:06 pm
This one comes via e-mail from T-Rex:
Can you ask Mr. Carey to tell us what his background is? Does he have roots in Hawaii and does he consider this home? If so, what are his thoughts on things that can be done, locally to improve the economy, schools and other networks that make a community successful?
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I was born and raised in Denver Colorado and moved to Hawaii in the late 70’s. Other than a little grad school time, I have lived in Hawaii ever since. I married a girl from here and relish the fact that I live in Hawaii. I have an electrical engineering degree from Stanford University, a law degree and an MBA from Santa Clara. I practiced law for a few years before devoting my full time efforts to Outrigger.
To me, the key issue for all of us to focus on is to improve our public education system. We really need to give the children of Hawaii a better opportunity to compete in the world. Our community must become passionated in helping improve our schools.
July 8th, 2008 at 1:10 pm
This one comes from John K:
How would you describe the changes in the tourism industry in the last 30 years? Is Hawaii being over run by other international destinations?
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Hawaii has changed as our population has grown. We have evolved from a quaint far away place that served primarily a few upscale travelers to a place that makes dreams come true for thousands. With growth, comes change and Hawaii has in fact changed. We have many of the finest resorts in the world and, in spite of what some say, the best people in the world. I strongly believe the Aloha spirit is alive and well, albeit perhaps a little more modern.
We compete every day with international destinations, but I believe if we keep our physical plant in good shape, with our year round weather and great people, we will be competitive.
July 8th, 2008 at 1:14 pm
Here’s another one sent in via e-mail from Greg:
What are you future investment plans in Hawaii? How would you describe the hiring landscape for your young people looking for jobs in the visitor industry and what advice can you share?
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Outrigger intends to continue to invest in our properties and people. It does not appear at the moment there will be many new properties built, so we must make the ones we have the best they can be. That means renovated rooms, more amenities, great shops and restaurants etc.
I worry about the young people here as I believe we have let them down by not insisting on top quality public education. I hope we can all fix that.
July 8th, 2008 at 1:14 pm
Sorry, folks, we’re out of time. Thanks for participating in today’s Hot Seat. And a special thanks to Outrigger’s David Carey for taking the time from his busy schedule to answer questions from our readers.
Watch for excerpts of this Hot Seat session in this Sunday’s Focus section of The Advertiser.
Stay tuned to see who our Hot Seat guest will be next week. Thanks for joining us, on The Hot Seat!
July 8th, 2008 at 1:16 pm
I am told it is time to sign off. Thanks for the opportunity to comment today. Thanks to all who submitted questions and others who just watched. Aloha. DC
July 21st, 2008 at 10:48 pm
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