SHANE MCLAVE, DIRECTOR , EXCEL RECRUITMENT

Reopening reaction: Director Shane Mclave on what the government’s guidelines mean for hospitality

Excel’s Director Shane Mclave gives his thoughts on the recent government guidelines ( and their ongoing updates) for the hospitality industry’s re-opening and what more needs to be done to support the industry.

The much-awaited guidelines for hospitality businesses reopening arrived last week, with further developments since and more expected to come. All have been met with a very mixed reaction. Some of these guidelines absolutely make sense in terms of keeping everyone safe, while some of them seem plucked out of thin air and do no more than hinder hospitality businesses trying to return to profitability. Under the latest guidelines, patrons are given a 105 minute limit on the time they can spend in a pub or restaurant. But why? This seems to be an arbitrary number plucked out of thin air, with no real basis in science from what anyone can tell. Another concerning guideline for wedding venues and hotels is the onus being placed on staff to maintain social distancing at all times, including on dancefloors. How can anyone expect this to work in real-life without placing an increased workload on staff or potentially jeopardising guest experience? One of the biggest questions for businesses of all sizes, from intimate restaurants to large hotels and contract caterers is in what world can chefs maintain a 2m distance in a busy kitchen during service?

Uncertainty for hospitality industry

According to latest updates The 2m social distancing guideline but this can be reduced to 1metre* in controlled environments . But what does this mean? Many who have already spent time mapping out 2m within their premises and have spent money on signage displaying a 2m distance. There are major differences in readying a space for 2m and readying the same space for 1m. With a little over a week to go until June 29th, businesses nationwide are right now doing the trojan work of figuring out what the recent government guidelines mean for them and applying the necessary changes to their premises while coping with unclear and rapidly changing guidance. While everyone is happy to be opening sooner than August as originally scheduled and hopefully salvaging some of the summer season, the one thing the government’s original 5 phase plan did give was certainty. We’re all aware that COVID-19 and the fight against it are constantly evolving but is it fair to ask individual businesses to bear the brunt of this uncertainty alone?

There needs to be a recognition that these recent government guidelines cost time and money to implement and enforce and businesses need to be given the supports to do so. There needs be further recognition that many venues won’t be able to operate under them; through absolutely no fault of their own. Many high-end restaurants and pubs whose USP is their cosy and intimate atmosphere and reversely, many events venues whose business model is large crowds will have to hold off until the virus is further suppressed.

Long term supports

Again, while an earlier opening date is most definitely a positive news story; more sustainable, long term supports will be needed. Many tangible suggestions have been proposed by the Restaurants Association of Ireland including 0% VAT rate for the tourism & hospitality industries for the period of the crisis & an entire year afterwards, then reverting to a 9% rate for a period of 5 years after along with relief on rates or rent for the rest of the year. It cannot be a case of “now you’re open, you’re on your own.” Everyone has been on the same side of closing to ensure public safety, that cannot swivel to the government and hospitality industry being on opposite sides when it comes to getting the country back running. One of the things that lockdown has shown is the resilience, creativity and desire to succeed of the hospitality industry in adapting to challenges in the market. That in itself is reason to be positive. Best of luck to all our clients and businesses reopening in the coming weeks and congratulations on all your efforts.

 

Creativity

How creativity is key to hospitality industry’s bounce back

Pivot.. pivot… PIVOT!!! Everyone remembers the episode in Friends when Ross, Rachel and Chandler are trying to get the couch up the stairs and Ross is shouting “Pivot” to no avail! Well that is exactly what the hospitality industry is going through at the moment! We are holding the future of our industry in our hands, stuck on a corner, knowing we have to pivot but not entirely sure how to do it! So what is a pivot? A pivot is when a company makes a change to its business model after realising that they are unable to service the market in its current format.

So how do we accomplish that?

I spoke to a number of companies this week to check in how they are adapting and I was delighted to get such a positive response. For example, I spoke to senior management in Boojum and they told me how they decided early on to meet the challenge head-on. They left a small number of stores open for delivery only as well as click and collect and adapted the layout of all their kitchens to create a new workflow that kept the staff a safe distance apart while not affecting productivity. They are now looking at reopening more stores with the same template. Boojum also introduced initiatives for staff that were temporarily laid off, one of which was a free daily meal! This is a fantastic idea as it kept staff engaged with the brand while not working and highlighted to the staff how they are valued by management.

This echoes reports that I am getting when I speak to people in the Quick Service Restaurant Industry on the high street. Most have pivoted their business to service takeaway and click and collect demand which allows them to remain open and functional while working away in the background figuring out how they are going to manage to return to regular service. Amazingly, some QSR operators who have adapted to take advantage of the demand for home delivery are reporting that their sales figures are level with figures for 2019 with one operator that I spoke to admitting that he was in the middle of opening a new outlet!

What about hotels?

We are seeing that a number of hotels and restaurant are starting to reopen, offering a reduced menu for click and collect and home delivery. Earlier, I spoke to The Castleknock Hotel who is doing just that. They have been busy designing and implementing a new service for their customers which has been a massive success for the hospitality industry. They have adapted the kitchen, implemented new Health & Safety guidelines and also rotated the staff to ensure that social distancing protocols adhered to. By rotating the staff on smaller shifts, it also promotes employee engagement and give the staff a sense of purpose albeit in a limited capacity at present. Now doing a takeout coffee service, they will keep the call and collect model when the Hotel fully reopens and they also hope to expand by adding of a new outdoor area in the coming weeks!

There is a lot to look forward to in the coming weeks as we start to see the ingenuity and resilience of the Hospitality Industry adapt to challenges in the market. There are green shoots starting to spring up so get up off that couch and pivot…

IHF Conference- The Key Take Home Points

Not even the looming threat of the Beast from the East could put a damper on the success of the Irish Hotel Federation’s annual conference last week. Held in the Slieve Russell Hotel, the conference included a fantastic line-up of speakers, interesting insights and informative discussions. General Manager of Excel Recruitment Shane Mclave talks through the main talking points from the event.

2017 success for the industry

There was plenty of positivity new stories from the event. According to IHF chief executive Tim Fenn, 2017 was another strong year for Irish hotels and guesthouses and the seventh year in a row that overseas visitor numbers have grown. The average national room occupancy rate was 73% during the year, a figure driven by a substantial increase in visitor numbers from the US and continental Europe, as well as from the domestic market. This was welcome news for hoteliers and helped to offset the drop in visitors from the UK, where numbers continue to fall. Fenn asserted that the outlook for the sector remains positive with hoteliers confident about the future growth of the tourism and hospitality industry.

Craic alone not enough for tourism

Niall Gibbons of Tourism Ireland also discussed the dramatic drop in British visitors and said “the craic” won’t be enough to recover plummeting visitor numbers. Mr Gibbions said Ireland must hone in on outdoor activities to entice visitors from Great Britain, which is the country’s biggest tourism market. Visitor numbers from Britain have fallen steadily since the Brexit referendum vote in June 2016 and dropped 6% last year to 4.7 million visits. As a result, tourism officials have focused more on opening up ‘emerging’ markets like India and China and winning more business from North America and mainland Europe. Tourism chiefs are hoping to look beyond traditional boozy holidays and hope to win more business in the activities market. Daragh Feighery who will be opening the much anticipated Center Parcs in Longford gave us a sneak peek at what is in store for what will be a huge jewel in the crown for the Midlands with over 1000 staff in employment once the doors are open to the public mid-2019

End to the Chef Crisis in sight?

One of the most exciting talking points from the conference came from TD Brendan Griffin, Minister for State and Tourism. The TD casually mentioned that changes to work regulations for work permits are on the cards for 2018, potentially easing the country’s chef shortage. The statement was met with huge support and enthusiasm from all, particularly hoteliers and business owners all too familiar with the struggle of recruiting and retaining chefs.

1,300 hotel rooms to be added to Dublin, but supply will still be tight

It’s forecast that Dublin will see 1,300 new hotel rooms added to the capital this year. More than 500 of the rooms will come from extensions to existing hotels while six new hotels are expected to open in the city in in 2018.

Dalata, Ireland’s largest hotel group, will continue to grow opening three Maldron Hotels and a Clayton Hotel, a 140 room property on Kevin Street and a hotel on the site of the former Charlemont Clinic on the Grand Canal which will have 180 bedrooms opening in September. This month, the McGill family’s Iveagh Garden Hotel will open on Harcourt Street. The family also own the Harcourt and Harrington Hotels and the new 152 room property houses an underground river which will act as a source of renewable energy.

The Liberties will see the opening of Ireland’s first Aloft hotel in the spring with 202 rooms. The hotel is bound to be a hit with tech lovers as guests can use smartphones and Apple Watches to open their room doors. The Dean’s sister hotel, the 41 room Devlin will open in Ranelagh this summer, along with its own 50 seat cinema. According to Davy Stockbrokers said that 2018 will be the first time in almost 10 years that Dublin will see a “meaningful increase” in the supply of new hotel rooms.

Despite these new openings, Dublin’s hotel supply will still remain tight as Dalata close two hotels, the Ballsbridge Hotel and Tara Towers towards the end of 2018/start of 2019. Tara Towers will shut down later this year ahead of being redeveloped into a 140-bedroom Maldron Hotel while the groups lease on the 392-bedroom Ballsbridge Hotel is due to expire in October and while the group is expected to seek an extension of the lease until March of 2019, the property is then set to re-developed by Chartered Land.

Outside of Dublin, Belfast will get 4 new hotel additions, the Grand Central Hotel opening at the end of May with 304 rooms, the Maldron with 237 rooms, Marriott Hotel will open in the Quays area with 190 rooms and a Hampton Hotel will host 180 rooms. Cork’s South Mall area will also get sees a new Maldron too with 230 bedrooms.

Irish hotel occupancy rate rises to 81.6%, up 3.7% from last year

Irish hotels have recorded occupancy rates of 81.6% in April, a rise of 3.7% in April this year compared with April 2016. Dublin hotels, remained unchanged from this time last year, recording occupancy rates of 8%.

The data, published by STR, reports that the average daily rate of a hotel room in Ireland during April 2017 had reached €122.60. This is an increase of 7.7% compared to the previous year. During the same period, Dublin recorded a slightly lower percentage increase of 5.5%, but the average price of rooms came in more expensive at €129.04. Revenue per available room (RevPAR), or room revenue divided by rooms available, was €100.10 in the whole of Ireland in April 2017. That was an increase of 11.7% on the same period a year earlier.

In Dublin that figure was €111.01 for the same period, an increase of 5.4% compared to the same month in 2016. In the 12 months ending April 2017, activity within the hotel industry was slightly more restrained. In the whole of Ireland occupancy rates were 70.3%, the average daily rate of a room was €114.76, but the revenue per room available was considerably lower at €80.67. Those figures were all up on the previous year.

For the same period in Dublin, occupancy rates were slightly higher at 75.5%. The average daily rate for a room was €122.38 while the revenue per room available was €92.41 – an increase of 6.2% on the twelve months to the end of April 2016. Investec research suggested that revenue per room available will grow by 6.5% in Dublin by the end of 2017.

Hotel News- Major hotels planned for Dublin and Galway

Hotel and food market planned for Galway’s city centre, Tivoli owner adds ‘performance space’ to proposed 283 bedroom hotel, DCC give green light to Stephen’s Green luxury hotel.

€60 million hotel and food market planned for Galway

A €60 million development is in the works for the centre of Galway comprising a brand new 200 room hotel and a covered market. The food hall is expected to cover 17,000 square feet and will be situated under a double height ceiling. It will draw inspiration from similar food markets in Europe, such as London’s Covent Garden. The Connaught Tribune reports that ‘discussions are under way with a hotel operator which specialises in boutique-style city hotels in Europe’. The plans outline that the Market Hall will have capacity for 80 market stalls and would focus primarily on food, while there’s also plans for roof top terrace restaurant. The development is still subject to planning approval from Galway City Council.

The new proposed development will be located on Galway’s Market Street and the project is the brainchild of Michael Maye a telecoms entrepreneur and is being promoted by Davy Private Finance.

Performance space added to proposed hotel on Tivoli theatre site

The owner of Dublin’s Tivoli Theatre has added a ‘performance space’ to a proposed 283- bedroom hotel in a bid to obtain planning permission on the site of the theatre, its owner has proposed adding a new “performance space” to the development.

Planning consultants working for Anthony Byrne have told Dublin City Council the proposed hotel development in Dublin 8 would include a new public area, Tivoli Square,that would double as an “occasional” outdoor cinema and venue for performances.

In January, Byrne applied for planning permission to demolish the Tivoli Theatre and replace it with a six-storey, 298-bedroom aparthotel.

Byrne has reportedly written to the council stating the development will operate the proposed new indoor venue as a cultural facility into the future.

DCC give go ahead for €40million luxury hotel in Stephen’s Green

DUBLIN CITY COUNCIL have given the green light to a €40 million plan to convert Loreto Hall on St Stephen’s Green into a luxury hotel.

DCC has given the company heading up the project, Brown Table Solutions Ltd, permission to go ahead with their plan for an 87-bedroom hotel which will include a restaurant and spa at 77 St Stephen’s Green. The project will involve building an eight-storey block to the rear.

The development has been giving the go ahead in spite of objections from the Department of Foreign Affairs (DFA), Office of Public Works (OPW) and the Irish Georgian Society.

The Ministerial offices of the DFA are located next door at Iveagh House and, in its objection, Director of the Department’s Property Management Unit Kevin Colgan told the council that “the privacy and security of Iveagh House is of paramount importance”.

Mr Colgan pointed out that Iveagh House regularly hosts Heads of State, national and foreign dignitaries, political leaders and high-ranking diplomats for sensitive meetings and negotiations.

He said: “The proposal to construct a bank of hotel rooms with windows facing directly into the Iveagh House offices and ballroom (its main meeting room) with inadequate separation distance, is of great concern to the DFA.”

Loreto Hall went on sale last year with a guide price of €5.75 million. In 1911, it was bought by the Loreto Sisters to use as a hostel for young women from outside Dublin attending the National University at nearby Earlsfort Terrace and the Hall – built in 1765 – remained in use for “country girls” going to colleges in the city until the 1990s.

Objectors have the option of appealing the Council decision to An Bord Pleanála.

Howl At The Moon nightclub to be replaced by 53-room hotel

An application has been submitted to DCC for planning permission to demolish Howl at the Moon nightclub on Lower Mount Street, Dublin and build a 53-room hotel on the site.

Dale Vision, a company associated with Oakmount, the development company headed by Paddy McKillen Jnr and Matt Ryan is behind the application. The location was previously part of the Capital Bars group and was sold in 2014 to Danu Investment Partners, along with other well-known Dublin venues, the George, the Dragon (since reopened as NoLita) and Café en Seine in a €15 million deal.

The venues became part of the Mercantile Group following a merger in 2016with Howl At The Moon being sold again some months later to Oakmount for a reported €3.2 million.

The present building is noticeably different from the rest of the buildings on Lower Mount Street. Standing at three storeys, the nightclub is significantly shorter than its Georgian neighbours, the majority of which are four to five storeys over-basement. The current building also lacks the brick façade of every other building on the street.

Oakmount plan to replace the existing building with a six storey hotel with a brick front.

Oakmount already owns one completed hotel, The Dean on Harcourt Street, Dublin, and has planning permission for two more in Ranelagh and North Wall Quay.

The layout of the new hotel will be similar to that of the company’s others, featuring a bar and reception area at ground floor and a rooftop restaurant including outdoor terraces. The four floors designated for accommodation will contain 53 guest rooms, while the basement will contain function rooms and a meeting room.

Oakmount’s hotel in Ranelagh village is currently under construction and is due for completion in June 2018. The 1,868sq m hotel will offer 41 guest rooms, a bar and restaurant at ground floor and a rooftop restaurant, in addition to a small art-house cinema.

Construction is due to begin soon on its 58-bedroom hotel on North Wall Quay, which will likely open in late 2018 following an 18-month build.

In all, Oakmount will have 204 rooms across its four hotels once they are all completed, assuming the Mount Street plans are approved in their current form.

Hotel News- Major moves made in hotel properties

Ard Rí sold

The Ard Rí in Waterford city, one of Ireland’s most well-known hotels has been sold. The hotel has been closed for a number of years and its condition has deteriorated significantly. The hotel was a popular wedding venue, conference centre and holiday accommodation. Situated on an elevated site of approximately 21 acres, it has been sold for an undisclosed sum to a Kilkenny businessman who is based in Australia. Seamus Walsh intends to invest heavily in the project. He said: “I see huge opportunity for development in this area and look forward to transforming my new hotel to its former days of glory in these more modern times.” In 2015, Mr Walsh purchased another hotel in the area – the Waterford Castle Hotel- for more than €6m. The distinctive building takes up a large portion of the skyline north of the River Suir at Waterford.

Planning application for hotel in Dublin’s north inner city

A new planning application has been submitted for an eight-storey 249-bedroom hotel development at River House on Chancery Street in Dublin’s north inner city. The application was filed by Melonmount Ltd and will involve the demolition of the existing vacant six-storey building. The application proposes to build an independent cafe/restaurant unit at ground floor and mezzanine level. The remainder of the ground floor will have a hotel lobby, reception, breakfast area. The basement will have a fitness room, meeting and function rooms. The proposed development also includes public realm enhancement works to Chancery Street and Greek Street. Speaking to thejournal.ie, Dublin city councillor Ray McAdam said: “In terms of the proposal, I welcome it. I really do. From a local point of view, it has been a scourge, whether you’re talking about looking at it or otherwise. It has been a source of a lot of anti-social behaviour and criminality.”

iNua Hospitality buys four-star Hillgrove Hotel in Monaghan

iNua has bought the four star Hillgrove Hotel in Monaghan marking its sixth Irish hotel purchases in the last three years. The Hillgrove Hotel was sold by long-time proprietors Colm and Audri Herron who plan to retire. iNua Hospitality currently own the five-star Muckross Park Hotel & Spa in Killarney, the Kilkenny Hibernian Hotel and the Radisson Blu Hotels at Little Island in Cork, Limerick. Last July, it also acquired the Radisson Blu Hotel in Athlone.

The Hillgrove is set on its own private grounds extending to over six acres, opposite Macartan’s Cathedral , a few minutes from Monaghan Town Centre. The present owners acquired the hotel in April 2004 and, since then have invested in the addition of 43 spacious en-suite bedrooms and the development of the Living Well Leisure Centre & Spa facility which today has nearly 1,000 local members.

Dublin hotels saw highest occupancy in Europe in 2016

Dublin hotels had the highest occupancy in Europe in 2016 and are forecast to stay on top in 2017 and 2018, according to PwC ‘ s European cities’ hotel forecast 2017 and 2018.

The report found that hotel occupancy in Dublin was higher than London, Amsterdam, and Berlin within the same period. Dublin’s average daily room rate ranked ninth most expensive in Europe at €128.This average is expected to reach €138 in 2017 and even further to €147 in 2018.

The report showed that Geneva and Zurich in Switzerland had the highest average daily rate on the continent. The most expensive city is Geneva at €300, followed by Zurich at €245 and Paris at €229. PwC said while security concerns saw mixed fortunes for some city destinations in 2016, overall it was another record-breaking year for European tourism with 12m more visitors and almost 3bn nights spent in tourist accommodation.

Dublin Airport had a record-breaking 28m passengers in 2016, which exceeded the 2015 record by more than 2.8m. The report found that European hotel deal activity did see a slow down of nearly nearly 10% from the record high of €21bn in 2015 to €19bn in 2016, still the second-highest level ever recorded. The drop was largely driven by a slowdown in transaction volumes in the UK which fell by over 60%, due to Brexit uncertainty.

Stellar growth for foodservice industry on the menu again in 2017

 

Ireland’s food service industry experienced massive growth in 2016, reaching a record €7.5bn. This positive trend looks set to continue next year and is expected to reach up to €9bn by 2020.The vast majority of spending is taking place in the Republic, which is responsible for nearly €5.4bn, 72%of the total. Consumers in the North of Ireland spent around 2.2bn in the last year.

The food service market includes anywhere outside the home that food is consumed including restaurants, hotels, coffee shops, workplace catering, hospitals etc.Despite the economic uncertainty brought by Brexit, the Irish food industry has weathered the storm well and the forecast remains positive. Ireland’s economy has been on the up, with strong employment levels, for the past number of years and although that growth is expected to even out to more moderate levels next year, households will still maintain an increased amount of disposable income.

The reduction of VAT on food to 9% has also stimulated the industry. In 2011, the Government reduced VAT on food and accommodation, which had the welcome effect of boosting tourism at a particularly shaky time for the industry, and the economy as a whole. Despite the recovery, the Government announced in their latest Budget, the VAT rate in both of these sectors will remain low.

Tourism has grown at a record pace this year, with 2016 seeing an increase of 13% in overseas visitors, leading to the much documented shortage in hotel accommodation. The numbers of business travellers to the country have also increased with hotels catering for conferences and events benefiting and experiencing particularly impressive growth.

A recent Bord Bia report showed that so-called ‘Quick Service Restaurants’ accounted for 34% of all revenue in the sector. Pubs accounted for 20% while hotels were responsible for 19% of the overall take. Cafes and coffee shops had a 5% market share.

Food service 2016 (1)

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