Hotel market sees 800 new rooms added as development ramps up
Development activity is ramping up in the Irish hotel sector, with some 800 new bedrooms delivered to the market in the first nine months of this year, according to a new report from Cushman & Wakefield.
Construction work was completed on 15 hotels in the same period, the report into the sector found.
Most notably, 87pc of the rooms delivered were in Dublin across both new builds and extensions.
Two significant openings earlier in the year included the 145-bedroom Iveagh Gardens Hotel on Harcourt Street, Dublin 2, and the 140-bedroom Maldron Hotel on Kevin Street, Dublin 8. Three more openings are anticipated for the fourth quarter in Dublin, and one in Cork.
A further 2,800 hotel rooms were under construction at the end of September, a 37pc rise annually, across 31 hotels. Again, the majority of these rooms are in Dublin, with a mix of aparthotels right through to five-star hotels now in the pipeline.
Approximately two-thirds of the rooms under construction comprise new builds, while 19pc are extensions. The remaining 14pc is accounted for by hotel redevelopments.
Kirsty Rothwell, head of trading assets at Cushman & Wakefield, said: "Dublin city is now seeing a steady pipeline of bedrooms coming on stream, which is encouraging to see. As the gateway to the rest of Ireland, it is vital to the wider hotel market that Dublin remains competitive and attractive to tourists."
Turning to hotel transaction activity, Cushman & Wakefield says investment in Irish hotels amounted to €36.5m in the third quarter, bringing the nine-month total turnover to €79.3m, across just eight transactions. Compared to the same period of 2017, a 10pc fall in the value of sales was recorded. This excludes any unconventional hotel sales such as company sales, loan sales and refinances.
Just one hotel sale in the year to date was over €20m in value. Transacting in the third quarter, the four-star Hilton Dublin Airport sold for €22.5m to Canadian-based Westmont Group in their first venture into the Irish market.
Also in the third quarter, UK hotel investor Propiteer purchased the recently-refurbished four-star Ibis Hotel, just off the Red Cow Roundabout, for in excess of €14m.
These two hotels were the only two to transact in the capital in the year to date. Taken together however, they accounted for 46pc of the total value. Of the remaining transactions, four hotels were in the West of Ireland, and two in the South East.