DUBLIN HOTELIERS managed to improve occupancy levels last year, but only by sacrificing the rate of revenue per room.
New hotel figures released by business advisory firm Deloitte show that occupancy rates in the capital rose 5.6 per cent to just under 67 per cent in 2010.
Deloitte partner Kevin Sheehan noted that Dublin outstripped many competing UK cities in terms of hotel occupancy growth last year.
However, this improvement was achieved at the expense of room prices: the average daily rate for Dublin hotel rooms fell from €85.83 to €79.22 in 2010.
The hotel industry across Ireland has been hit by weak consumer sentiment, adverse weather events and overcapacity.
It is understood that close to 100 Irish hotels have been transferred to the National Asset Management Agency (Nama).
Late last year the agency’s chief executive Brendan McDonagh said Nama was not in the business of supporting “zombie hotels”.
However, some banks are allowing hotels in receivership to remain open, and offer extremely low rates, simply to keep cashflow going.
Mr Sheehan said 2011 is likely to remain challenging for Dublin hotels. “It is still very much a case of survival of the fittest,” he said.
Hotels must concentrate on rationalisation and cost management, while attracting the “new leisure traveller” from China and India.
The opening of the convention centre in the city, and the designation of Dublin as a UNESCO City of Literature may boost tourism in the capital this year, he said, and hoteliers must capitalise on these opportunities.
Tom Barrett of Savills Ireland noted that passenger numbers at Dublin airport fell 10.1 per cent in 2010.
“This reinforces the increased dependence of Dublin hotels on the domestic market, where the industry now sells a large number of heavily discounted bedrooms,” he said.