Hotel investment now a £1bn business

The report was released at Hospitality Exchange 2019, a two-day conference which took place at Crowne Plaza Belfast last week.

The report reveals that four-star accommodation now dominates the sector which comprises 145 hotels with a bedroom stock of 9,548 rooms.

NIHF CEO Janice Gault said: “The hotel landscape has altered dramatically and it’s only when you look back to 1999 that you realise the seismic changes that have occurred. Hotels have invested heavily with new builds, extensions and refurbishments.

“As a result, the entire market has moved up the grading scale with a total investment in the region of £1bn. The four-star market has really grown, and budget hotels are now just 16% of the overall room stock. The one and two star sector is more or less defunct.

“Hotels have become much larger with the average hotel now comprising of 66 rooms. In 1999 the average was only 36 rooms. There is a greater concentration of hotels in urban areas, with a greater number of brands operating in the local market. New types of accommodation have become available with online platforms strengthening their hold over the market.

“After a period of considerable expansion, the sector now comprises of 145 hotels with a bedroom stock of 9,548 rooms. There have been some pressures in the market but it is important to note that in Belfast, where most of the expansion has occurred, demand year to date (YTD) is running at plus 8.3%.

“However, the cloud of Brexit looms over the UK with the Northern Ireland economy in a vulnerable position. Uncertainty is the real enemy here. People are holding back on bookings. The ROI market which has grown considerably over the last number of years is of particular concern. Any physical barrier or perceived impediment to movement of visitors across the island is not good news for tourism.

“As 2019 comes to a close the hotel sector is in a good place in terms of investment and stock. The industry is a resilient one and has become adept at coping with change. Hotels are resilient by their very nature and continue to show real commitment to the Northern Ireland economy.”

Earlier this month, The News Letter reported a £60m proposed development for a new hotel and office block in Belfast city centre with work expected to begin early next year.

The proposals will see the existing site of Norwich Union House replaced with a new six-storey mixed-use building that will deliver 243,000 sq. ft new build floor-space to include a 174 bedroom hotel and grade A office space.

In July, a new £7m Holiday Inn Express opened in Londonderry city centre with the creation of 44 jobs at the hotel in Strand Road with plans to add another 31 bedrooms by the end of the year to the 119 now available.

Phase two will introduce a brand-new bar and restaurant whilst phase three will bring the introduction of 25 self-catering apartments in 2020.

A new £5m 24-bedroom hotel opened in Ballycastle ahead of The Open at Royal Portrush in July.

The Salthouse has been described as an “eco hotel” and one of the most sustainable in Ireland and Europe complete with an onsite wind turbine and solar panels integrated into the design. Water provided at the hotel comes from its own borehole.

Last month, Clayton Hotels, which is part of the Dalata Group announced a £3m investment in its four-star Belfast city centre premises.