Since 2011, hotel deals in Ireland have reached a total of €2.4 billion, according to property consultants Savills Ireland. Last year, the country’s hotel sales were worth €850 million—coming in second behind 2015’s €710 million for 63 sales.
Tom Barrett, head of hotels & leisure at Savills Ireland, said that the country is “unique” in terms of the “sheer volume” of hotel sales. In some cases, the same hotels have changed hands several times.
2016’s major deals included Blackstone Group's sale of the former Burlington Hotel in Dublin for €182 million to German investor Dekabank, the €92-million sale of the Gresham Hotel to Spanish firm RIU Hotels and Resorts, the €55-million Temple Bar Hotel sale, the €150-million Fitzpatrick Lifestyle Portfolio sale, the sale of the Radisson Farnham Estate (€27 million) and the Lyrath Estate for €23 million.
"Hotel development, like many areas of the property sector, stopped during the downturn, so there is a big element of catch up in Dublin,” Barrett told the Irish Independent. “This, coupled with air traffic surpassing all previous records in 2016-with further growth expected this year-means there is a real need for new bedroom stock in the right areas.” This, of course, echoes statements from other Irish hospitality insiders: In November 2015, JLL Hotels & Hospitality Group said that Dublin needed an additional 3,000 guestrooms to satisfy current demand.
That number is likely to be surpassed fairly soon. Back in June, DTZ Sherry FitzGerald predicted that that Dublin alone would get 6,100 guestrooms over the next three years, and planning permission had been secured for 4,200 of those rooms at the time. Savills is predicting that Dublin will only get 100 new guestrooms this year, with no new properties being built. (The growth would come from extensions to existing hotels, including the North Star Hotel.)
Next year, however, the city is poised to get 1,500 new guestrooms, with two new Dalata hotels opening (A Clayton and a Maldron). In 2019, Dublin could get a full 2,000 new guestrooms, including a new 402-bedroom hotel linked to Dublin Airport's Terminal 2 and extensions to a number of existing airport hotels.
Those new guestrooms can't open soon enough. According to the Irish Tourist Industry Confederation, Dublin had Europe’s highest hotel occupancy rate last year at 82 percent, which drove up room rates. If room rates get high enough, travelers may look elsewhere for their vacations, or might opt for Airbnb instead.