11% of Irish hotel rooms in receivership

Some 11% of Irish hotel rooms are in receivership, according to an industry survey published today which nonetheless indicated that hoteliers are optimistic of the prospects of an upturn.

Some 70% of Irish hotels expect occupancy levels to rise this year, according to the 16th annual Horwath Bastow Charleton Irish Hotel Survey 2011.

However the survey also reveals that hotel room have fallen by €24 or 25% over the past three years and the average room rate for Irish hotels is €74.

Intense competition between hoteliers, in a market which is over-supplied with hotel rooms, was seen as the influencing factor in forcing prices to drop further in 2010.

According to the survey, 50% of hoteliers expect room rates to increase and only 10% expect further decline in the current year. It is expected that 2011 will record profit growth after four years of falling profits, as growth in occupancy was evident from the second quarter in 2010.

“Generating demand will be key to addressing a solution to the oversupply issue in the Irish hotel sector and the most likely source of this demand is the overseas market,” said Aiden Murphy, Partner, Horwath Bastow Charleton.

“The rate of their return to Ireland will be a determining factor in the recovery of the Irish hotel industry.”