Fáilte Ireland has said that four cities here need to increase their stock of hotel rooms to keep up with expected growth of tourists coming to the country over the next five years.
The tourism body said that if Ireland’s recent strong performance continues, then overseas tourist numbers will be up more than 20% over the next five years, which will put pressure on current accommodation stock levels, particularly in urban areas which traditionally grow at a faster rate, amplifying any accommodation squeeze.
Its latest report on the current and future availability of accommodation shows that there is a major need in Kilkenny for more hotel beds, while Galway also needs more.
The Analysis of Tourism Accommodation in Cork, Galway and Kilkenny report looks at the current and projected level of bed stock across all accommodation types. The analysis focuses on hotels predominantly, as they constitute the primary source of accommodation in each of the cities, accounting for more than 80% of bed spaces.
The report highlights that the biggest squeeze is in Kilkenny, where 41 new rooms are likely to come on stream by 2022 to add to the current supply, an increase of just 4%, which presents a strong opportunity for investment in this sector.
Galway, which is currently at 82% annual occupancy, also has significant room for investment. With an estimated 17% increase in hotel bed stock over the next five years, 500 new hotel rooms, this increase is likely to fall short of expected demand growth.
Looking at Cork, today’s report shows that there is a steady pipeline of new hotel stock coming on stream for Ireland’s second city. With current figures projecting a 35% increase, or more than 920 new hotel rooms, in Cork by 2022, the rebel city is well placed to take full advantage of all future growth potential.
Earlier this year, Fáilte Ireland published An Analysis of Tourism Accommodation in Dublin, which estimated that, from 2018-2020, 4,900 hotel rooms will be added in Dublin (when hotel closures are considered), including more than 3,000 already under construction.
According to the tourism body, this represents an investment in Dublin of around €815m.
Fáilte Ireland’s CEO Paul Kelly said: “We estimate phenomenal growth of 8% in revenue this year, and our economic modelling predicts that tourism will have spurred employment growth of a staggering 20,000 jobs in the year, bringing the total number up to 260,000. This performance is very much reflected in the growing visitor numbers and high occupancy levels we’re seeing in Dublin, Cork, Galway and Kilkenny.
“In 2019 we believe that there is potential to grow by a further 5% in overall tourism revenue, an upward trajectory that is likely to continue in the coming years. The challenge of sustaining this growth in the long-term is to ensure Ireland has an adequate accommodation supply, particularly in these four key cities.
"While there is a future supply of hotel beds in the pipeline for Cork and Galway, looking at the current and projected levels of visitor demand, there is certainly still a strong case for more investors and businesses to move into the sector and consider each of these cities for investment.
"Galway could also benefit from increased capacity as projected growth in the city exceeds the current planned increase in beds.”
The report commissioned by the national tourism body was carried out by Fitzpatrick Associates Economic Consultants.
- Digital Desk