THE number of hotel rooms in Belfast city centre is set to increase by almost half at the end of the year, according to new figures.
The Belfast Hotel Market Snapshot, published by Lambert Smith Hampton has revealed that hotel room numbers are to jump by 47 per cent year-on-year by the end of 2018.
The increase has been fuelled by an unprecedented rise in hotel development, with a total of 1,170 new rooms delivered already this year and an additional 183 due to be completed by Easter 2019.
Key developments completed this year include the £53 million Grand Central Hotel, the 237-room Maldron Hotel, the AC Hotel Marriott and the new Hampton by Hilton on Great Victoria Street. The additional rooms due for delivery are across four hotels and include the 63-bedroom George Best Hotel, due to open at the end of November and the Bank Square Boutique Hotel.
There has been strong revenue growth in Belfast against industry metrics due to the increased demand. Between 2015 and the first six months of 2018, the average daily rate in Belfast increased by a quarter to £81.65, while the average revenue per available room (PevPAR) grew by 29 per cent to £66.11.
Compared with key cities in the UK and Ireland, Belfast has the third highest average room rate and RevPAR after Dublin and Edinburgh. Notably, Belfast’s average room rate and RevPAR is also above the well-known mini break locations of Manchester and Glasgow.
Director of hotels at Lambert Smith Hampton in Ireland, Darren Fitzsimons said the Belfast hotel market is simply responding to the "booming" local tourism industry.
"Over the last decade, the number of overnight trips to Belfast has doubled to almost 1.5 million and associated expenditure has increased by 120 per cent.
“While 2017 was a record year for hotel demand in Belfast, with average occupancy standing at 81.5 per cent, hotel development has taken some time to respond. Limited new stock and rising demand left the market acutely undersupplied with hotel accommodation.”
Dr Claire Cole, senior research analyst at Lambert Smith Hampton, added a note of caution in relation to the hotel figures.
“The latest Northern Ireland Statistics and Research Agency (NISRA) data indicates that tourism will continue to grow, with forecasts of five million visitor trips to Northern Ireland per annum and a spend of £1bn. However in the short term, Belfast hotel occupancy rates, average room rates and RevPAR are likely to soften as the city adjusts to the unprecedented level of additional supply.
“We expect the market to reposition itself before an injection of further investment and development after 2021. Recent developments have been principally in the 3 and 4 star markets, creating a gap in the market for 5 star hotels and luxury hotel brands not currently represented in the city but which are synonymous with truly great cities. When that happens, Belfast can justifiably claim to be among the elite of European hotel destinations.”
