Belfast hotel boom fails to stifle a surge in room rates
The cost of staying overnight in a hotel in Belfast has increased by an average of £5 to reach £80 in the past year, a new report from business advisers PwC has found.
Despite a boom in new hotels creating more competition and pushing occupancy rates down, Belfast is now the fifth most expensive city in the UK to book a room.
Last week a report from agents Lambert Smith Hampton (LSH) found that 1,170 new rooms had been added to the city centre this year.
The hotels which opened this year include the Grand Central, the Maldron, Hampton by Hilton, Easyhotel, the AC Marriott and the Flint Hotel.
The PwC Hotels Forecast 2019 suggests that the average daily rates (ADR) in the city increased by 5.5% from £75.67 in June 2017 to £79.80 now. The rise is considerably higher than the UK average (0.8%), making it the third fastest-growing rate of 22 cities.
LSH's report suggested the average rate has risen even higher to £81.65.
PwC assesses the financial performance of hotels by using the revenue per available room (RevPAR) measure. The average UK hotel room generated £67.63 in the last year (+1%), whereas Belfast's rooms garnered £62.28. However, that RevPAR rate represented a 4.6% rise from last year's £59.56 figure.
The Hotels Forecast found that increased competition in Belfast contributed to a 0.9% fall in occupancy rates. However, the city's 78% occupancy rate remains well above the UK average of 75.2%. The report predicted that Northern Ireland and other UK regions are unlikely to experience any growth in occupancy to the end of next year.
Nonetheless, the building boom is continuing in Belfast with new hotels and major extensions construction. A number of projects include the former Crumlin Road Courthouse by Signature Living, which also wants to open a hotel on Waring Street, and McAleer and Rushe's bid to build a 250-bedroom hotel on Corporation Street.
Martin Cowie (left) from PwC said: "The influx of high-quality rooms to the market have driven and continue to support improved RevPAR and ADR for the city.
"Though the full impact hasn't been realised with Signature Living's new hotels in Waring Street and Bedford Street due to open by the end of the year, and the Crumlin Road Courthouse which just received planning permission, demand continues to be driven by inbound tourism, domestic holidays and events.
"Hoteliers can look forward to the 148th Open being held in Portrush in July 2019, the biggest sporting event ever to be held here, which will bring a surge of visitors."