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Michael Brennan of Killarney Hotels: ‘It’s probably more efficient to close at Christmas’

Managing director explains why the hotel sector is ‘in a good place’ and why he never envisaged a different line of work

On Sunday afternoon, after breakfast and lunch have been served and all the previous night’s guest have been checked out, the five-star Europe Hotel in Killarney, Co Kerry will close its doors for Christmas. It won’t reopen until February, and even then it will essentially only open at weekends until March 17th when it will open round the clock.

Its sister hotels – the Dunloe (opens again at Easter) and the Ard na Sidhe Country House Hotel (reopens end of April) – closed weeks ago. For the past number of weeks, the Europe has only been open to guests between Thursday night and Sunday afternoon.

Michael Brennan, managing director of Killarney Hotels Ltd, accepts that it “sounds unusual” to shut at Christmas, one of the busiest times of the year in the hospitality sector here, and says the hotel is “constantly asked to open for Christmas”.

“But it’s the holiday that all the staff know they’re off,” he says by way of explanation. “It gives them time to go and recharge the batteries and it also gives us time to make as much dust and noise as we want to and redo the place from head to toe and reopen again in February.”

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At the time of the interview in late November, renovation work on 21 rooms, including the presidential suite, had already begun. Some €3.5 million is being spent by its German owners, the Liebherr (pronounced Lee-Birr) family, to smarten up the resort for next year.

Between the three hotels, the group would have 450 staff during the peak summer months. This drops to 250 people approaching winter. “It gives staff the chance to take time off. They’ve banked hours in the summer so they’re getting paid the full week, 99 per cent of them.”

By closing at Christmas, isn’t the hotel leaving a lot of money on the table?

“You leave a lot of turnover on the table. I don’t know how much profit you leave on the table by the time you pay everyone the bank holidays and for the days pre and post [Christmas] that really aren’t that successful. And we give the people the time to have the holiday. If we were open for Christmas our bar staff and waiters would want to take time off in the summer. They deserve to be with their families. It’s probably more efficient this way.”

Judging by its latest financial results, Brennan might have it right by closing for Christmas.

In 2022, the three Killarney hotels posted record annual revenues of €30 million between them, up from €18 million a year earlier – a reflection of the bounce back in business as pandemic-related lockdown restrictions were lifted. This year he expects the revenue figure to come in at about €31 million.

In the pre-Covid year of 2019, its turnover was just shy of €23 million, giving an indication of how strong the bounce back has been, and the higher rates now being achieved. “Our turnover has increased by 50 per cent in the past five years,” he says, adding that when he arrived 23 years ago the hotels had revenues of about €7 million between them.

The group also returned to the black last year, posting a modest profit of €217,081, having racked up combined losses of almost €19 million in the previous two years, when Covid-19 restrictions forced the closure of the Irish hospitality sector for much of the time.

Rates have risen in the period but so has the occupancy rate, doubling over the years to about 80 per cent currently. Brennan says the cheapest room rate is €350 per night, with breakfast. “You’ll pay just under €500 for a lakeview room,” he adds.

The presidential suite is the most expensive room in the resort, at €1,950 per night this year. “We’re renovating it and it will actually be €2,500-€3,000 next year,” he says.

Brennan believes the Europe offers good value for guests, with a “relaxed and warm” welcome for visitors. “For example, I like a cup of coffee in the morning. If I go to the petrol station it’s €3. I see nobody and I get my cup of coffee in a takeaway cup. I can come here, get a cup of coffee, in a cup and saucer that costs us €30 to buy, get home-made biscuits, wifi, pick up a copy of The Irish Times in the lobby and read it.

“The cup of coffee in the hotel will cost €4.50. You meet the doorman, you meet the girl in reception, you meet the waiter. Where’s the better value?

“Our business relies on people coming back to us and the vast majority of our customers are paying for the stay themselves. They are not corporate people. You can’t go from charging €490 today to €600 next week because the Munster football final is on.”

Killarney Hotels comprises the 185-bedroom Europe resort, its five-star sister property the Dunloe (102 bedrooms), and Ard na Sidhe, a four-star 18-bedroom Victorian country house. There is also a farm, where it rears its own cattle and sheep. “We use 37.2 tonnes of beef in the company and 13 tonnes of that is from our farm and we hope to get it to half, that’s our goal.”

The Liebherr family first invested in Killarney in 1958, opening a factory on a site across the road from the Europe that makes port equipment and container cranes.

Brennan recalls well the night in March 2020 he had to ring Johanna Platt, granddaughter of Hans Liebherr, who brought the family business to Ireland, to tell her that the country was going into lockdown and the hotels would have to shut. “She said ‘Michael, the family are behind you, the company are behind you, make the best decisions you can and we’ll get through it’. And we did. I work for a remarkable family.”

The family are “very hands on”, he says, and visit their Irish businesses every couple of months – they also own a 12-hole golf course beside the factory.

As well as the renovation of guest facilities at the Europe, Brennan is overseeing the construction of a second phase of staff accommodation on site.

“In 2018/19 we did the first phase ... we put on 40 single rooms. And now we’re putting on another 40 single rooms plus an employee gym, and a room for socialising. We will have spent €12 million on staff accommodation between the two,” he says.

“Nobody can get affordable accommodation locally and there’s no short-term accommodation available. During and after Covid when nobody could get staff we had accommodation and could get staff. Now practically all the hotels [in the area] are trying to do the same.”

A skeleton staff will keep the place ticking over until February, it’s award-winning spa will remain open until Christmas Eve and people can also pop in to purchase gift vouchers, an important market for the hotel given that 75 per cent of its guests are domestic (the balance is 20 per cent American and 5 per cent from other countries).

Brennan hails from Blackrock in Dublin and his family is steeped in the hospitality trade. His father, the late Michael Brennan, was group general manager of the Doyle Hotel Group and opened the Burlington Hotel in Dublin for PV Doyle almost 50 years ago. His brother John is chairman of Klarant Hospitality.

“We grew up in hotels. My mum had a shop in the Burlington, and we were in the hotels every other day. I learned to swim in the Burlington pool. My 13th birthday party was in the rooftop restaurant in the Burlington. We spent Christmas in hotels. We used to move into the Burlington on Christmas Eve or the day before Christmas Eve until the day after St Stephen’s Day. It was fabulous.

“I got stuck in a lift in the Burlington one Christmas Eve. We were meant to be going to midnight mass. I went up in a service elevator and got stuck in it for over an hour on my own. I was probably 10 or 11 but I was used to it. It was in the veins. But I have Christmas dinner at home now.”

PV Doyle was a legendary figure in the Irish hotel trade. “A fascinating man,” says Brennan. “He was a visionary, opening the Berkeley Court and the Westbury [both in Dublin]. When the Burlington opened, it was the first hotel here to have a television in every bedroom. The Berkeley Court [now gone] was a five-star hotel that was as good as anywhere in the world.”

Brennan admits that he was always destined for a career in the hotel trade. “I never really gave serious consideration to anything else. I spent a summer working in an accountant’s office and in the second week I was back behind the bar in the Burlington on a Friday and Saturday night pulling pints. I worked in all of the Doyle hotels at some point in time. It was always to be.”

What’s the attraction of working in hospitality, given the often unsocial hours, the hard work and the relentless nature of the industry?

“No two days are ever the same and there’s a great social life to working in hotels. It’s just that our Saturday nights are Tuesday nights. I’ve worked in Paris, the south of France, Switzerland, the US, Canada and London. I just love it.”

This is Brennan’s second spin around the track with the Europe, having done a college placement there one summer. “I loved the hotel when I was here before and when I got a phone call about this job I thought ‘yeah, that’s the job for me’. I thought I’d do a year or two but I’ll be here 23 years in February and I’m married to a local girl so there’s no going back now.”

He says “very little” had changed at the Europe when he returned to run the business but it has moved to a “different level” over the past two decades. More than €100 million has been invested in the property in his 23 years, he estimates.

Some fun facts on the Europe. “We sell a bottle of Coca Cola every 10 minutes. We sell a bottle of champagne every 45 minutes, 24 hours a day, and the bakery makes 1,000 biscuits a day.” It’s also the number two rate payer in Kerry, with an annual bill of €500,000.

The Europe must also be one of the few hotels in Ireland not to see its energy bill double after Russia’s invasion of Ukraine early last year. “We made a brave decision not to lock in our energy prices. They went up 20 per cent but they didn’t double. It was a gamble but it paid off.”

Brennan reckons it saved the hotel €750,000, although its energy bill for this year will still be a substantial €1.2 million. “It would have been €2 million if we had locked in.”

The Irish economy is facing some headwinds with growth expected to slow next year. But Brennan is positive on the outlook. “We think next year is going to be another very good year. Our forward bookings are strong. The hotel sector is in a good place.”

At 58, is retirement hoving into view? “No. At that age you do check the pension fund a bit more carefully than at 48 but it’s not something on the horizon. The next [redevelopment] project will certainly take us to 2027 and beyond. That’s going to keep me fully occupied.”

CV

Name: Michael Brennan

Job: Managing director of Killarney Hotels

Age: 58

Lives: Killarney, Co Kerry

Family: Married to Marilyn with a three-year-old daughter, Eve Elizabeth, and a Labrador called Hudson

Hobbies: Walking the dog and skiing

Something we might expect: “I started working behind the bar at the Burlington at 15. It’s in the blood.”

Something that might surprise: “I spent my college placement here. Never thought I end up back here running the place but I did.”

Leadership style: “I’m hands on but encouraging and open to change.”

Favourite other Irish hotel: “The Westbury or the Shelbourne if I was in Dublin city centre. It’s nice to get the buzz of the city. In a resort, Ashford Castle is amazing.”

Favourite hotel abroad: “The Four Seasons in Jimbaran Bay in Bali. It’s an incredible place.”