Hoteliers call for action over industry ‘crisis’

HOTEL owners have called on the Government to roll out a series of emergency measures to safeguard an industry they claim is in crisis.

Suggesting that 10,000 of the 65,000 jobs in the hotel sector could be in jeopardy, the Irish Hotels Federation (IHF) demanded new credit facilities of up to €150,000 for owners, a reduction in local taxes and rates, a new incentive scheme for investors and a guarantee the State’s new bad bank agency will not distort property market prices. Yesterday’s meeting of 200 IHF members in Malahide was held in light of a number of worrying developments in the industry over recent months.

Among them the examinership of the Lynch Hotel Group, the conversion of two hotels in Tallaght built by the property developer Liam Carroll into studio apartments and the liquidation of the company behind the financing of the redevelopment of Whites Hotel in Wexford.

Following the meeting the IHF suggested that without intervention there will be “devastating implications” for hotels and guesthouses.

Among the emergency measures and concerns raised by the IHF following the meeting were:

* The removal of tax measures allowing capital allowances to be clawed back if a hotel ceases to trade within the agreed seven-year tax life. Struggling hotels are unable to “exit” and only keep trading to keep the tax benefits, the IHF suggested.

* A tax incentive scheme for investing in hotels should also be created which would allow investors to develop sites.

* Pointing to the fact that hoteliers paid out more than €102 million in rates in the past year the IHF suggested local authority rates needed to be reduced as they were “killing business”.

* The federation also expressed concern about the National Asset Management Agency (NAMA), warning its start-up could distort the hotel sector.

* The inclusion of hotel staff and employees in the Government’s proposed employment subsidy scheme.

Following the meeting, IHF president Matthew Ryan said the Government needed to intervene and facilitate “an orderly restructuring of the hotel sector in a way that is sustainable and allows our members to continue to be major employers and contributors to the Irish economy”.

“We are calling on the Minister for Finance to explicitly require that NAMA operates in a manner that does not distort markets, does not support unfair competition and does not provide state aids to specific enterprises or entrepreneurs,” said Mr Ryan.

The IHF has also said it will be seeking a meeting with Government ministers to discuss their proposals.