The 1,500 new hotel rooms planned for Cork could be too much for the market to bear, the Irish Hotels Federation (IHF) has said.
A report by the Cork branch of the industry group said more than €11.5m was spent on renovations and improvements to hotels in the region in 2018.
Most hotels spent between €50,000 and €2.5m. It said that it was "concerned" there would be too many bedrooms if construction of the Cork events centre doesn't start soon.
The average room rate increased by 15% to €109 across the region, the report said.
The average room rate charge in a bed an breakfast in the low season is €40 a night. The cost for a five-star city hotel rises to as much as €215 in peak season, it said.
Unsurprisingly, the busiest period was from July to September.
More than a third of hoteliers said there was an opportunity to grow their business in the first six months of the year.
Chair of the IHF Cork branch, Neil Grant said the business group was aware of price hikes around certain events such as concerts.
"Rates are always higher in every destination when there’s a demand squeeze. If you’re right in the heart of the action, you’ll pay a premium. If you leave it until the last minute, when there are only a few rooms left, you’ll pay a higher price.
"We recommend booking early for the best rates, and if people are willing to go a little further from the action, there’s always value to be had. Of course, the IHF is conscious of prices and we monitor it. With the significant investment put into hotels in Cork, the quality has never been better, so our hoteliers are in a position to charge slightly more than they did during the recession years," he said.
The report said the 1,500 bedrooms planned would be a 50% increase on current availability, which could put pressure on existing hotels.
Mr Grant said: "Whilst this is great news for the city, as it could attract more than 3000 extra people a day, our survey found that hotels in the city and county are currently only averaging a 74% occupancy rate. Our members are concerned that the increase in bedroom provision could oversaturate the market, if the Cork events centre does not get underway soon."
The long-mooted city centre events centre has been beset by delays since then Taoiseach Enda Kenny turned the sod on the project shortly before the 2016 general election.
Many hoteliers applied to extend their bedroom capacity or build new hotels on the basis that the events centre would attract a significant increase in business and leisure tourism to Cork.
"It is therefore imperative to our industry and to the local economy that it comes to fruition and we need absolute confirmation on its delivery as soon as possible," Mr Grant said.
Almost all hoteliers surveyed said they were having difficulty recruiting, despite more than 350 jobs are currently available.
"There are huge opportunities available in the hotel industry in Ireland, but currently we have to recruit outside of the country," Mr Grant said.
The report also found four in five hoteliers believe Brexit will affect their business, while almost all said they were concerned about the increase in Vat, staff shortages, recruitment legislation, and the additional capacity of rooms coming onto the market.