Delivery date needed for €80m Cork events centre, says hotel industry

Over 1,500 additional hotel rooms to come on stream in years ahead, says hotel organisation

A hotels federation survey in Cork city and county reveals average occupancy rate of 74% , leading to fears that additional rooms could oversaturate the market if the Events Centre does not start soon. File photograph: Getty Images

A hotels federation survey in Cork city and county reveals average occupancy rate of 74% , leading to fears that additional rooms could oversaturate the market if the Events Centre does not start soon. File photograph: Getty Images

 

Cork needs a definite delivery date for the planned €80 million events centre if the city’s hotel sector is to capitalize on the 1,500 hotel rooms scheduled to come on stream over the coming years, the Cork Branch of the Irish Hotels Federation (IHF) has revealed.

According to Neil Grant, Chairman of the Cork branch of the IHF, more than 1,500 new hotel bedrooms are due to come on to the market in Cork city in the coming years, providing a 50 per cent increase on the number of rooms available.

Mr Grant said that such an expansion could attract more than 3,000 people a day to Cork. But an IHF survey of the existing hotels in Cork city and county found an average occupancy rate of 74 per cent, leading to fears that the new rooms could oversaturate the market if the Cork Events Centre does not start soon.

He said that many hoteliers applied to extend their bedroom capacity or build new hotels on the basis that the events centre would attract a significant increase in business and leisure tourism to Cork so it was imperative for the industry that there is a confirmation on its delivery as soon as possible.

“If a big convention of 3,000 people was brought to Cork in November, it would justify the development of the additional bedrooms and would sustain growth of the sector, but if it doesn’t. It will be detrimental to the industry,” he said.

Tánaiste Simon Coveney – who has been centrally involved in plans to deliver the events centre for Cork on the site of the former Beamish & Crawford on South Main Street – has expressed confidence the project will come to fruition despite costs spiraling from an initial estimate of €53 million to €80 million.

Mr Coveney confirmed just before Christmas the Government had agreed to up state funding from €20 million to €30 million with the balance of the costs being carried by developer BAM and promoter Live Nation who will operate the 6,000-seater centre.

Meanwhile, Cork branch of the IHF has revealed that local hotels have spent more than €11.5 million on renovations and improvements in the region in 2018, with more than 80 per cent investing in capital expenditure with upgrades ranging from €50,000 to €2.5 million.

The IHF survey also found that more than 350 jobs are available in the hotel sector in Cork with some 170 of these being full-time positions and 193 being part-time positions though 94 per cent of hoteliers surveyed said they find recruitment a challenge and are struggling to find suitable staff.

The IHF is taking a number of measures to address this, including a campaign to encourage students to consider a career in the hospitality sector, a local partnership with Cork Institute of Technology to promote the industry and an apprentice initiative with the college to upskill local hotel staff.

Looming Brexit

Mr Grant said almost 80 per cent of hotels surveyed believe Brexit will affect their business while almost 100 per cent said they are concerned about the increase in VAT, staff shortages, recruitment legislation and the additional room capacity without the confirmed promise of the events centre.

“In addition to this, Ireland is also 22 per cent more expensive for visitors from the UK on exchange-rate change alone since 2012 and this could change again depending on the outcome of Brexit. This would have a significant effect on UK visitor numbers, our second biggest market,” he said.

Identifying the reasons why visitors choose Cork as a destination, hoteliers said the main selling points are corporate business travel, the Wild Atlantic Way and Ireland’s Ancient East tourism routes, food culture, scenery as well as attractions like Blarney Castle and Fota Wildlife Park.

The IHF survey found that July to September was the busiest time of year for 96 per cent of properties and 35 per cent of hoteliers said they believe there is an opportunity to grow business during the first six months of the year particularly if there is increased frequency and capacity at Cork Airport.