Hoteliers grow more pessimistic amid rising costs and falling occupancy
Irish Hotels Federation (IHF) president Michael Magner and IHF Chief Executive Paul Gallagher ahead of their annual conference in Killarney.
Business sentiment among hoteliers has dropped again with just over a third reporting a positive trading outlook for the year ahead amid a slip in occupancy rates and high operating costs, the Irish Hotels Federation has said.
A survey conducted by the Irish Hotels Federation (IHF) earlier this month on 195 hotels and guesthouses showed that almost every region in the country experienced a slight drop of between 1% and 3% in occupancy rates during 2024 compared to 2023. The only regions that did not experience a drop — Dublin and the midlands/mid-east region reported — no change.
The average national hotel room occupancy rate for 2024 was down 2% to 74%.
According to the IHG, business sentiment among hoteliers for the year ahead is down for a second year running with 37% of hoteliers reporting a positive outlook for trading conditions over the next 12 months.
This contrasts with 47% who reported a positive outlook this time last year and 74% the previous year.
IHF president Michael Magner said that 2024 was a difficult year for many hotels given increases in the cost of doing business.
“The situation has been compounded by the decision to increase the rate of hospitality Vat, which has hit food service businesses particularly hard. It is therefore very welcome that the Government has committed to revisiting the Vat issue as part of the budgetary process.”
The IHF said that hoteliers are reporting a further drop in business levels on the books for 2025 equivalent to €100m in bookings.
The survey showed that 94% of hoteliers are worried about the global economy and the potential impact of political uncertainty in key markets while 78% said they are concerned about the outlook for the Irish economy over the next 12 months, citing pressure on consumer finances and international risks.
“The Government, in partnership with the industry, has a pivotal role to play in creating a more positive business environment for enterprises throughout our sector,” said Mr Magner.
“There is a lot more that the Government can do to assist businesses in labour intensive industries such as our own.”
The IHF’s annual conference is set to begin today, Monday, in the Gleneagle Hotel & INEC in Killarney.
