Legacy issues including large overhanging debts remain a burden for many hotels and guesthouses across the country while an over-reliance on the domestic market outside of traditional tourism hotspots is also inhibiting their potential recovery.
Other challenges facing the hotel sector include the high cost of doing business here; including rising labour costs and excessive local authority rates, according to the Irish Hotels Federation.
Those worried about keeping their business afloat are in the minority, however, with most benefitting from an uptick in overseas visitors and a more buoyant domestic consumer market.
The number of visitors from north America (13%), Britain (11%) and the rest of Europe (14%) have all increased in the past 12 months while 85% of hoteliers also report increased levels of business this year from the home market.
“Irish tourism has performed strongly throughout the year and we’re now approaching a record-breaking 8 million overseas visitors for 2015.
This is an enormous achievement and a testament to the hard work of the thousands of tourism businesses throughout the country.
“Next year looks set to deliver further growth across our key markets such as Britain, north America and Europe providing a further boost to hotels and guesthouses,” said IHF president Stephen McNally.
Targeted initiatives such as the Wild Atlantic Way and Ireland’s Ancient East trail have proved hugely successful in attracting visitors, Mr McNally said.
Allied with the 9% hospitality sector Vat rate which was maintained in October’s budget, a number of hotels are on firmer ground than they were a year ago.
The improving performance of the domestic tourism industry was borne out by figures released by the CSO yesterday which showed domestic trips in the third quarter of the year are up almost 4% on the same period of 2014.
Of those, 965,000 stayed in hotel accommodation while holidays accounted for 60% of all domestic trips.
As a result of the pickup in demand, 92% of the country’s hotel and guesthouse owners are planning to invest in refurbishment and product development in the next year with almost two-thirds eyeing a larger marketing spend.