Saturday 17 March 2018

Dublin hotels see demand surge as room supply bites

CBRE received over 20 bids for the Zanzibar hotel property
CBRE received over 20 bids for the Zanzibar hotel property
Ronald Quinlan

Ronald Quinlan

Dublin's hotels saw a surge in activity in September, according to the latest STR data released last Thursday.

Having experienced something of a dip the previous month to +11pc (due to the movement of the Dublin Horse Show from August to July to facilitate the equestrian teams competing in the Rio Olympics), RevPAR - or revenue per available room - rebounded to +19pc in September.

According to the latest numbers, Dublin RevPAR is now up 19.4pc in the year-to-date, with September alone registering a record occupancy of 93.6pc.

Commenting on the latest figures, Davy's research analysts said it "further highlighted the supply/demand imbalance that exists in the Dublin hotel market".

That imbalance in supply and demand is once again set to be reflected in the prices being sought and achieved for the existing Dublin city hotels that are being brought to the market.

Only last week, the Hotel ibis at junction 9 of the M50 at the Red Cow Luas interchange was put up for sale by Christie & Co with an asking price of €13m.

The €13m price tag is significant given the fact that the hotel's current owners, Hetherly Capital Partners, only completed their purchase of the hotel in August 2015, having already agreed to acquire it in a sale and franchise back deal for a sum in excess of €5m in 2014.

While the property has benefited from major capital investment over the past 14 months with all 140 of its guest bedrooms fully upgraded to what the agents describe as "the most modern brand specifications", the €13m now being sought for the property still represents a major uplift in value.

Elsewhere in the capital, the Sunday Independent understands over 20 parties submitted initial bids two weeks ago for the Zanzibar hotel property on Dublin's Ormond Quay.

While CBRE had been seeking €5m for the premises, which formerly was a part of Liam and Des O'Dwyer's Capital Bars Group, it is understood a number of offers came in well above that figure.

Zanzibar's current planning permission provides for the conversion of two protected structures and the provision of an 89-bedroom hotel totalling 7,077sqm - of which 5,494sqm is new-build and 1,583sqm is retained protected structures.

Sunday Independent

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