If you’ve been to Hawaii recently, you might’ve noticed something surprising. Despite their rising popularity, the islands are not seeing many new hotel constructions. So what gives? Today, we'll dive into why you're not seeing more new hotels In Hawaii. The market demonstrates strong demand through high occupancy rates during peak seasons and stable room rates. Building new lodging in Hawaii presents distinct challenges. They include rapidly increasing construction expenses alongside restricted land availability and stringent zoning regulations.



The Disney Aulani Built way back in 2011



The Big Picture: Why Developers Aren’t Building New Hotels



- The state of Hawaii faces a scarcity of buildable land. As a result, authorities protect most available areas for their cultural importance, or developers avoid them due to prohibitive costs.- Construction expenses in Hawaii rank among the highest nationwide. Construction materials require shipping from other places. Additionally, labor costs remain high, while the permitting process also continues to be lengthy.- Developers steer clear of most available areas because high costs and cultural protections make building difficult. Combine that height limitations and strict environmental rules present significant barriers to new hotel approvals.- Local communities push back against new development. "This is largely due to concerns about overtourism and cultural disrespect, which in turn often lead to project delays or cancellations before they even begin.



Risk vs. Reward For New Hotels in Hawaii



 Rebuilding from scratch often isn’t worth it. Hotels originally constructed in the 1970s and 1980s usually select renovations. This approach provides quicker results at a lower cost while avoiding controversies. Still, to this day, most hotels offer the same basic boxed rooms.. Most contain the same square footage even after the renovations.



Here are some recent standouts:



1Hotel Princeville



Kauai- Developers have extensively converted the former Princeville Resort into a luxury wellness resort. It emphasizes sustainable design and native landscaping elements. - The Royal Sonesta underwent renovations a couple of years ago—owners gave the property a facelift and remodeled all the rooms.



Renaissance Honolulu Hotel and Spa



Oahu- Hawaii Hospitality Group renovated the Ambassador Hotel Waikiki and the Romer House Waikiki, an adults-only, both of which offer affordability.- Hilton Hawaiian Village updated its renowned Rainbow Tower by preserving its mid-century design yet introducing modernized rooms and facilities.- The Renaissance Honolulu Hotel & Spa is the latest addition near Ala Moana which delivers a modern upscale accommodation experience for both business and leisure visitors.



Big Island- Kona Village, A Rosewood Resort stands today as one of Hawaii's most stunning beachfront properties. Following its reconstruction after a natural disaster destroyed the original structure.- Hapuna Beach Resort is currently in the midst of major renovations. They will match its design and standards with its sister property Mauna Kea Beach Hotel.- After pandemic restrictions eased, Mauna Lani, Auberge Resorts Collection transformed its focus towards luxury combined with cultural immersion experiences.



Maui- The Fairmont Kea Lani underwent extensive changes to rooms , dining areas and public spaces. The result is one of the island’s most luxurious destinations that's perfect for couples and families.The Andaz Maui stands out as a newly constructed building. It replaced what used to be the Renaissance Hotel following extended demolition and redevelopment efforts.