AFTER A record 2008, well-known Irish hotelier John Fitzpatrick is finding the going somewhat tougher at his two New York properties this year due to the recession and global credit crunch.
“There’s no doubt but profits will be down this year,” he told me candidly by phone this week. “Revenues will be down 12 to 14 per cent but then our competition is down about 16 to 20 per cent.
“Profits could be down by 35 to 40 per cent if things don’t pick up but at least we’ll still be making a profit. We’re hoping that the economy comes back by the end of this year.”
Fitzpatrick Hotels Ltd – which operates the newly-refurbished four-star Grand Central and Manhattan hotels – had a bumper 12 months to the end of September 2008, recording a pre-tax profit of €7 million on turnover of €26.9 million. This compared with a profit of €4.5 million on sales of €24.8 million in the previous period.
If Fitzpatrick’s prediction comes through, the business will be back at 2007 levels by the close of the current financial year.
“New York was just booming last year and it’s coming back now. As long as I make a profit I’ll be happy.”
Fitzpatrick, who was awarded an OBE last year for his charity work in Northern Ireland, said January was a “disastrous” month for the hotels but occupancy levels at his hotels was a healthy 91 per cent in April.
The Fitzpatrick hotels also remain popular with Irish visitors to the Big Apple. “We did more Irish business in the first quarter from tour operators than we did last year,” he said. “The rates are lower and they’re getting great deals on airfares.”
Fitzpatrick told The Irish Times last year that he was interested in purchasing another property in New York but it came to nothing. “Everything was overpriced so I’m happy I didn’t do it. But I think there will be great opportunities in the next eight months to a year.
“What we’re looking at is management contract opportunities,” he explained. “In New York, an American bank has approached us about taking over an American hotel and we’re looking at that. There are also some opportunities in Ireland to take over or go in and manage [properties]. They’re coming to people with experience of a couple of recessions.”
