Inflation and staffing key concerns for NI hotel sector
The Northern Ireland hotel sector has bounced back from the impact of the Covid-19 pandemic but faces continued challenges from soaring inflation and difficulties recruiting staff.
Those are the findings from the latest sector report from the Northern Ireland Hotels’ Federation which also said around £100 million will be invested in construction, sales and refurbishment this year. While there aren’t many new hotel rooms due to come online in the next 12 months, the report estimated that by 2024 the total number of hotel bedrooms will break 10,000.
In analysis of the market by STR, if put the average room rate at just over £100 in 2022, up from £94 in 2021 and £72 in 2020. RevPar – the revenue earned per available room – sits at £72 compared to just £46 in 2021 and just £24 in 2020 when enforced lockdowns left many rooms empty.
However, costs for energy, food, labour and a host of other costs have soared and the sector body said the operating environment is difficult.
“Escalating costs and inflation reduce these to single digit growth with profits being squeezed which is impacting on profitability,” NIHF chief executive Janice Gault said, adding that finding suitable staff remains a real problem.
“2023 will be a year of balancing the need to cover increasing costs and maintaining staffing at a level which enables hotels to service the business that they have on the books.
“In 2022, many businesses missed out on potential revenue as they had to curtail and turn away trade due to staffing shortages.”
Sheadded historical analysis of the sector showed that the £1 billion invested in the sector over the last 20 years has transformed the sector’s product offering, seeing it double in size with a further investment pipeline of £300 million under consideration by developers.
