Dublin hotel market returns to form

DUBLIN—The opening of the 166-room Marker hotel near Trinity College in Dublin would have been unthinkable in 2007, when the city’s hotel market slipped off the cliff and had only begun its freefall.

The next several years saw occupancy fall from 74.1% to 63.7% in 2009 at its lowest year-end trough. Rate and revenue per available room in euro terms fell even deeper, each decreasing nearly 30% from 2007 to 2010, according to STR Global, sister company of Hotel News Now.

But when The Marker opened its doors 2 April 2013, Dublin was an altogether different city. Guests were returning. A new convention center was bringing in big business. And hotels that previously had fallen into disrepair were undergoing multimillion-euro face lifts.

“At the moment the level of business is very good so the supply and the demand are very much matching each other,” said Charlie Sheil, GM of The Marker.

Indeed, hotel performance in Dublin has rebounded with vigor. Occupancy through the first five months of 2013 was up 6.4% following three successive years of mid-single-digit increases. ADR through May was up 7% to €86.72 ($113.21), while RevPAR had increased 13.9% to €62.07 ($81.04), according to STR Global.

“We’ve had a strong start,” Sheil said. “We’re certainly seeing the benefits of that, a mixture of domestic business and international travel, between corporate and leisure.”

“We have seen strong occupancy rates amongst our Dublin portfolio in 2013, which is good news for Hilton Worldwide in Dublin,” said Steve Cassidy, area VP, U.K. and Ireland for Hilton Worldwide. Hilton has five hotels and 808 rooms in Ireland, all of which are in Dublin.

Demand drivers “Looking at industry trends, there has been a 4.1% increase in overseas visitors to Ireland in Q2 and a 14.8% increase in visitors from the U.S., providing a significant boost to the tourism industry in Ireland,” he wrote in an email.

North America has proven a significant driver of demand during the recovery, according to Stephen Hanna, chairman of the Dublin branch of the Irish Hotels Federation. While much of that can be attributed to a general economic recovery, the government-sponsored Gathering—a yearlong celebration of Irish heritage—has helped as well.

“The Gathering has definitely helped in a big way,” said Hanna, who also is GM of the Camden Court Hotel.

Peter MacCann has noted a lot of Gathering-spurred business at his nearby Merrion Hotel. Recently, for instance, the 123-room property hosted an American and 25 of his family members for a week. The group had come to explore their Irish lineage.

“It was only when they got here that we realized they were doing this under the guise of the Gathering,” he said. “… I think I might have been skeptical about it two years ago, but those who have come up with this idea deserve a pat on the back.”

The program is one of many government initiatives designed to boost tourism. Others include a reduction in the value added tax from 13.5% to 9% in 2011. A year prior saw the opening of the Convention Centre Dublin, which was Ireland’s first purpose-built conference venue.

“They’ve been very proactive, very supportive. They recognize the importance of the industry,” MacCann said of Ireland’s pro-tourism government officials.