Dalata and Lone Star deals push Irish hotel sales to €1bn
The value of hotel sales in Ireland topped a record €1bn last year with the major sales of Bewley's, Jurys Inn and Adare Manor swelling the new high.
The record-high is according to new research from property consultants Savills, which says that growth in overseas visitors and other factors helped sales.
Savills notes that demand for hotel assets was strong in 2015 due to a 14pc growth in overseas visitors, Dublin hotel revenue per available room (RevPar) growth of 20pc and the strong positions of the dollar and sterling. The firm also says that a 7pc bump in Ireland's GDP also contributed to the demand.
Speaking about the figures, director of hotels and leisure at Savills Ireland, Tom Barrett said: "Ireland's tourism industry is now achieving record volumes, and combined with a strong domestic economic recovery, this is driving high hotel occupancy rates throughout the country. This positive position attracted the attention of both domestic and international hotel operators and investors in 2015.
"We predict that 2016 will show further recovery with current positive indicators being maintained. Moreover, the addition of events such as the 1916 Centenary and the box office success of Star Wars will also attract visitors to both the capital and rural Ireland," he said.
Although a reasonable number of individual hotels are due to come to the market in 2016, Savills expect the focus to increasingly turn to development, particularly in Dublin, due to the shortfall in hotel bedrooms.
Speaking about hotel sales in the new year, gaming and leisure analyst with Goodbody Stockbrokers, Kevin McDermott, says that he expects a multitude of properties to go to market over the next 12 months.
"Moving into the next year it is known that there are hotels coming to the market. There are a number of hotels either on the market and people are bidding against them or there are hotels coming to the market over the next six to twelve months," Mr McDermott said.
The Goodbody analyst also expects 2016 to be another strong year for both hotel sales and the hotel industry in general.
"Outside of pricing, the Irish hotel sector will be strong again next year, I don't think it will be as strong as last year because this last year Dublin was the highest RevPar growth across the top 20 European cities that are tracked.
"Will it be top again this year? There is a decent chance of doing it but it won't be 20pc-plus RevPar, I don't think it can maintain that. However, we expect double-digit growth in Dublin and high single-digit growth in the regional cities," Mr McDermott said.
The strong performance of the hotel industry in Ireland in 2015 is expected to attract further foreign direct investment into the country.
"When they see RevPar growth in 2015 and the under-supply issue in Dublin and the Irish recovery in gross domestic product, it's only natural that foreign investors will come," Mr McDermott said.