Hotel sector spend is set to rival 2015
As much as €710m could be spent buying Irish hotels this year, bringing the value of hotel deals to the same level as that achieved last year. These are among the findings in the latest CBRE bi-monthly market report.
A total of 37 Irish hotel transactions with a capital value of €283m completed in the Irish market in the first nine months of 2016, while a number of significant transactions are due to close before year-end.
"Transaction volumes would be higher again if sufficient hotel product was available as demand for hotel opportunities in Dublin and provincial Ireland remains very strong from both Irish and international hoteliers alike," John Hughes of CBRE's hotel division says.
Hotel sales agreed recently include The Lifestyle Collection, which includes three Dublin hotels, which the John Malone Partnership bought for about €150m. The Spencer in the IFSC; The Morgan, Temple Bar; and The Beacon, Sandyford were sold by Fitzpatrick Lifestyle and its backer Patron Capital Partners. German fund Deka bought the four-star DoubleTree by Hilton Hotel, formerly known as The Burlington in Dublin, which is to be operated by Dalata Hotel Group.
Private Irish investor Situs Hospitality bought The Viking Hotel, Waterford, for about €5m from receiver Tom Kavanagh of Deloitte. The 98-bedroom hotel continues to be managed by the PREM Group.
Dan O'Connor of JLL, who handled the sale, said the Viking's "strong price highlights the continued improvement in hotel values and yield compression, which we have seen across the provincial Irish hotel market during 2016".
In Tipperary, the four-star, 40-bedroom Ballykisteen Hotel and Golf Resort was bought by Irish-owned Great National Hotels and Resorts for well in excess of CBRE's €2m asking price.
Currently, Goldman Sachs and Tifco are awaiting Competition Authority approval for their takeover of the Travelodge franchise in Ireland.
Should the deal get the green light, it would add 12 hotels with about 900 rooms to their existing portfolio.
Nearby, Dublin City Council has granted planning permission for the redevelopment of the former Ormond Hotel with 121 bedrooms.
In Dublin Airport, a planning application has been lodged for a 144-bedroom hotel beside the Radisson Blu Hotel, while the Dublin Airport Authority (DAA) is seeking expressions of interest for the development and operation of a 402-bedroom hotel at Terminal 2.
Opportunities currently on the market include: The IBIS Hotel on Dublin's Naas Road and adjoining 0.81 acre site, guiding €13.5m; Trinity Lodge Guesthouse, South Frederick Street, Dublin 2, guiding €6.5m; and Lynam's Hotel, O'Connell Street, Dublin 1, guiding in excess of €4m.