Strong performance by hotel sector in Northern Ireland, report finds
Developments in the sector include plans for Ireland’s first whiskey hotel.
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Northern Ireland’s hotel sector performed exceptionally strongly in 2024, new research has indicated.
A number of developments are also under way, including plans for Ireland’s first whiskey hotel.
CBRE NI found that the hotel sector continued to grow throughout the third quarter of the year despite a number of challenges across the commercial real estate market.
The leading commercial property agent’s Q3 Market Report reveals that revenue per available room (Revpar) rose by 8% in the first nine months of the year in Belfast and across Northern Ireland when compared with last year.
Some of the other highlights of the report include updates, such as the Armagh City Hotel being brought to the market with a guide price of £9 million, and the Lodge Hotel in Coleraine being acquired by McKeever Hotel Group.
Meanwhile, Patrick and Edmund Simpson have bought Da Vinci’s Hotel in Londonderry, the Londonderry Arms Hotel in Carnlough is being purchased by a consortium with plans to create Ireland’s first whiskey hotel, and the Foundry Hotel is opening in Belfast’s Cathedral Quarter.
However political and economic uncertainties are said to have contributed to slower activity across other sectors of the market, notably investment, with just £4.2 million transacted during the third quarter, taking the total for the year to £87.5 million – a 68% decrease compared with the same period in 2023.
The office market was boosted by the inclusion of three serviced office centres, recording 140,096 sq ft of take-up in Q3. However, occupier demand remains selective, with a preference for high-quality, tenant-ready spaces.
CBRE NI managing director Brian Lavery said the performance of the hotel sector in Northern Ireland has been exceptionally strong throughout 2024.
“Despite broader economic challenges, we’ve seen substantial investment and development activity, reinforcing the confidence investors and operators have in the region’s hospitality market,” he said.
“The combination of new developments, refurbishments, and key transactions demonstrates the continued growth potential within this sector.
We are optimistic that the upcoming Budget and potential public spending initiatives could revitalise key areas
“While Northern Ireland continues to experience pockets of growth, market sentiment remains tempered by economic headwinds and uncertainty surrounding the forthcoming Labour Government Budget.
“With borrowing costs still high and investors waiting to see the full impact of predicted fiscal policy changes, activity levels have slowed across several sectors.
“However, we are optimistic that the upcoming Budget and potential public spending initiatives could revitalise key areas. There is significant capital waiting in the wings, and we expect a more active final quarter of 2024.”
He added: “While retail remains a challenging sector, recent new openings and upsizing by H&M, Deichmann, TK Maxx and Apple point towards a more rejuvenated Belfast City Centre core.
“We are aware of other new amusements planned for 2025 which should provide further retail choice across the city.”