Hospitality sector Insights & Outlook H1 2021

Head of Hospitality at Bank of Ireland Gerardo Larios Rizo outlines how the accommodation sector performed in the first half of 2021.

Summary:

Accommodation providers across the country have been reopening their doors after a prolonged period of closure.

The much-debated pent up demand has so far delivered a strong flow of customers eager to reconnect with friends and family; demand has further been fuelled by the accelerated rollout of the vaccine. However, some concerns remain about the potential for further disruption from the COVID-19 Delta variant. Similar to last year, regional locations are reporting strong demand whilst trade in the capital

Hotel sector key activity and trends H1 2021

  • Trade resumes: Restrictions on non-essential trade lifted on June 2nd, and soon after hotels around the country started to reopen their doors. Vast majority of properties outside Dublin are now trading under more relaxed restrictions but are still precluded from hosting large indoor events or making full use of leisure centre facilities.
  • Staffing: Despite the figures from the CSO showing an 18.3pc adjusted unemployment figure for June 2021, recruitment continues to be a pain point for the sector and is likely to leave a permanent impact in cost of wages.
  • Strong demand: The ‘captive’ domestic market has delivered strong occupancy across a number of key holiday destinations. Targeted marketing efforts have helped a number of hotels deliver very strong room rates for June and July. Furthermore, the direct approach should also deliver lower commission costs. Lack of meaningful corporate and event-based demand continues to negatively impact Dublin hotels.
  • Investment: The extended lockdown gave hotel operators an opportunity to address refurbishment/investment projects without disturbing customers. Hotels like Dromhall in Killarney, Wineport Lodge in Athlone and Lyrath in Kilkenny carried out sizeable projects that are sure to impress their customers as they return.

Full report:

Hospitality sector Insights & Outlook H1 2021
Gerardo Larios Rizo
Gerardo Larios Rizo is head of Hospitality sector at Bank of Ireland.

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