Price of hotel rooms up 19% on last year, says STR

Hotel rooms in Dublin cost 19 per cent more in July than in the same month a year earlier, said STR, a data and analytics specialist.

The average daily rate in Dublin hotels during the month was €141.32, up 19.3 per cent, while an industry measure of performance, Revenue per Available Room (Revpar), rocketed by 18.9 per cent to €127.54, preliminary figures from STR show.

Revpar growth is calculated by multiplying a hotel’s average room rate by its occupancy rate.

The occupancy rate in Dublin hotels in July was 90.2 per cent. This was 0.3 of a percentage point lower than in the same month in 2015, but it is high by international standards. By comparison, the occupancy rate for London hotels last month was 88.4 per cent.

A separate study by PricewaterhouseCoopers published in April found Dublin hotels had the highest growth rate in Revpar terms in 2015 at 23.3 per cent.

Ireland’s capital is expected to come second only to Rome in PwC’s league table for Revpar growth in European “gateway” cities in 2016 and it is forecast to top the list in 2017.

The main driver of Revpar has been an increase in room rates, which rose 17.5 per cent in 2015, according to PwC, which placed the average room rate at €111 last year.

The number of hotels in Dublin has remained relatively static in recent years at 155, or about 18,900 rooms, which represents a third of the hotel stock in Ireland.

Both the supply of hotel rooms and demand for rooms in Dublin fell slightly compared to July 2015, STR’s analysis suggests. However, availability remains constrained, while the industry expects demand to stay high.

Although there are at least a dozen hotel proposals for the Dublin area, only one is expected to open this year: the 198-bedroom Holiday Inn Express in the former Findlater House office block on O’Connell Street. The 1970s building was bought in 2013 for €6.2 million by the London-based Seraphine Hotel Group.

At the start of the year about 182 rooms were lost to the Dublin hotel market when the Clyde Court Hotel (previously called the Berkeley Court) in Dublin 4 closed. It has been demolished to make way for a residential scheme.