Summer season data shows challenges facing the NI hotel sector

My term of office as the president of the Northern Ireland Hotels Federation is drawing to an end.

It has been three interesting years - a tale of surprises, survival and, based on the latest performance figures from STR, one of success.

Occupancy is sitting at 70.2% based on year-to-date trading, tracking below the 2019 pre-pandemic 72.4% level. Room rate is over £100 and RevPAR is hitting the £70 mark.

Belfast has recovered in an impressive manner albeit from a lower base. Other parts of NI have in the main had a good summer with many reporting strong trading.

On the face of it, this is all good news but there is clear danger ahead. The economy is uncertain with a recessionary narrative running in the media. There is a lot of hype and little focus on the progress we have made since March 2019. Throughout the pandemic hoteliers have shown resilience and adaptability. Restoration is the aim of all, and it is important to focus on the future.

The capital-intensive nature of hotels makes them a good long-term investment and there are major openings predicted in 2023 which should see room numbers touch the 10,000 mark.

Tourism is an export industry which is often overlooked, and this makes the weakness of sterling a real advantage for attracting visitors, staging conferences and promoting the destination. Many do not see our sector as an exporter but having broken the £1bn barrier in 2019, we hope that the sector would be given the same tax breaks and stimuli as those making inward investment.

It would be nice to be able to contribute more to the economy and hopefully, as more people return to employment, hotels can restore all their services. The sector has had to realign services to cope with staff shortages, and all of us have had to step in.

Visitors have come in their droves and everyone has done their utmost to give them a good experience.

Forecasting has often proved futile and a crystal ball would be required to predict what lies ahead but having invested over £800m over the last decade, hotels are here to stay.

Investment and interest in the hotel world remain high with over 800 rooms due to come on stream in the 2023-24 timeframe. Buildings are being repurposed into serviced accommodation and there is hope that immigration policy may be simplified which would allow us to address the labour shortage. The budget was disappointing, and the Federation will continue to lobby for a VAT reduction, recognition for the role of the sector and access to a larger pool of employees.

We must remain stoic, if not positive and realise that cost control, budgeting and maintaining staffing levels will be the key to surviving. We are in a better place than we were a year ago and while there may be a twisty road ahead, the future offers opportunities.

The countdown is on for Hospitality Exchange 2022 in the Crowne Plaza Belfast on October 11 and 12. Whether you own, manage or work in a hotel, B&B, pub, restaurant, museum, airline or coffee shop, then Hospitality Exchange is where you need to be.