Ireland’s tourism and hospitality industries are reflecting the country’s financial upturn with more than £116m worth of hotel deals either sealed or underway.
Within the past few months sales have been agreed on 15 hotels, together worth €96m [£80m], with 17 more on the market with a combined asking price of a little over €25m [£20.8m], claimed CBRE’s head of hotels for the UK and Ireland, Paul Collins. Contracts worth another €43m [£35.8m] have been signed on six further hotels, but they have yet to change hands.
The market is now close to being back to normal, he added, but several sites that had previously been earmarked for hotel projects were now being considered for potential office developments to meet growing demand. Because of this temporary divergence 2015 would almost certainly see the unveiling of a number of new catch-up hotel projects.
It was a claim, disputed at this year’s Hotel Property Conference where it was claimed there was still excess capacity on the market and there would likely be an oversupply for some time to come yet.
The Dublin conference — the first of its kind since the crash — heard that the profile of buyers has changed dramatically since Ireland’s emergence from recession with an increasing amount of international money flooding the market. This is beginning to change however, as a new type of buyer enters the market.
“We may get the American hotel real estate investment trusts coming in now,” added Collins. “We have seen some bidders from continental Europe, but they have not been as aggressive as the US guys. Prices in the US are so high at the moment, there are far more opportunities in places like Ireland than there are at home. There is value here that you just don’t see anywhere in North America.”
One recent high-profile hotel deal was the acquisition of Dublin’s Merrion Hall by the PREM Group on behalf of a small group of investors. Still under construction, with a completion date this summer, the consortium estimates that its total investment will exceed €5m [£4.1m].
“With its close proximity to the city centre and the docklands, we expect Merrion Hall to appeal to business travellers and tourists alike,” said PREM’s managing director, Jim Murphy. His company currently operates 36 hotels across Ireland, the UK and mainland Europe including city-centre budget hotels to luxury resort properties. Its latest addition will be opened under the Premier Suites brand.
The sale has also been agreed of the Rock Glen Hotel, Clifden County Galway. Sold through administration by joint agents CBRE and Mullery Auctioneers, the hotel — situated on a 23-acre estate with coastal views — was once popular with home and international visitors. It has 27 en suite rooms, an 80-seat restaurant and bar and was valued by the receivers at €450,000 [£375,000].
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