COVID-19 Crisis Halts ROI's Hotel Room Construction Boom
According to a new report from commercial real estate services firm Cushman & Wakefield, 4,850 hotel rooms were under construction in the Republic of Ireland at the end of 2020's first quarter.
87% of these rooms were in Dublin.
This is the highest level since of hotel room construction in the Republic that the firm has recorded since its records began, but the COVID-19 crisis has brought this hotel construction boom to a halt.
The Irish Times quotes Cushman & Wakefield as saying, "However, as the quarter ended and COVID-19 unfolded, uncertainty nested itself in the market.
"Hospitality was one of the first industries to be impacted and is arguably one of the most heavily hit asset classes so far."
2020 Room Delivery "Forecast To Decline"
Before the crisis commenced, the construction of 3,300 new hotel rooms was expected to be completed by the end of this year, but the number of rooms that will be completed this year is now expected to be much lower as a result of COVID-19-related business restrictions pushing completions dates for rooms that were that were due to be completed in the year's second and third quarters into the fourth quarter of 2020 and early 2021.
The Irish Times quotes Cushman & Wakefield’s Isobel Horan as saying, "2019 saw the first year of meaningful hotel development in almost a decade. While the opening quarter saw construction activity remain resilient, the overall delivery of hotel bedrooms is forecast to decline in 2020, hampered by impact of COVID-19 and construction capacity in the wider economy."
Hotel Transaction Activity
Cushman & Wakefield's report also revealed that hotel transaction activity was solid in the first quarter of 2020, amounting to €61.8 million. This figure was the result of four hotel sales, the largest of which was that of Co. Kildare's K Club.
© 2020 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.