Booming Belfast hotel sector could be impacted by Brexit-related slowdown
AFTER reporting a record 2018 the Belfast hotel sector is set to experience a more challenging year, partly due to Brexit uncertainty, according to a new PwC report.
The professional services firm's latest UK Hotels Forecast Update predicts more modest growth in 2019, compared to the exemplary figures posted in the previous 12 months.
During 2018 six new hotels opened, increasing the city's bedroom stock by almost a quarter (22.7 per cent) - the sharpest growth of any UK city and far ahead of its nearest rival, Southampton (8 per cent).
Belfast also placed highest in terms of occupancy rate growth, with a 15.5 per cent spike reported in the 12 months to December 2018.
The city remains the fourth most expensive in the UK to stay behind London, Edinburgh and Brighton, with an average room rate of £79.46.
The report also reveals that despite a significant drop of 6.3 per cent in the key performance measurement metric, Revenue Per Available Room (RevPAR), Belfast's £60.93 remains above the UK regional average (£55.46)
A city's RevPAR is calculated by multiplying the average achieved room rate by the average annual room occupancy rate.
Looking ahead, the PwC report forecasts further growth in the local market, with over 300 new rooms due to open this year, but not at the scale seen in recent years.
Belfast and Northern Ireland as a whole, however is set to report a significant tourism boon from the estimated 190,000 spectators due to descend on Royal Portrush for The Open this summer.
PwC partner, Martin Cowie hailed a "tremendous" 2018 for Belfast's hotel sector, but warned Brexit could impact on business this year.
“Though the RevPAR metric has fallen, Belfast remains the fourth most expensive to stay in for a second year, demonstrating that the city and the rest of Northern Ireland continues to appeal to visitors for a variety of reasons," he said.
“With the impact of Brexit, where reports suggest that potential travellers to the UK – particularly from across Europe - are adopting a ‘wait and see' attitude, and with a further increase of 5 per cent in the volume of rooms available, the local hotel sector may start to feel pressure on occupancy rates as well as RevPAR which may also take a hit.
“However on a positive note, the proactive response from the business community to engage with tourism leaders on strategic campaigns could play an important role in helping to combat the potential threats to the sector," Mr Cowie added.
The PwC forecast for the year ahead is for modest RevPAR advances right across the UK regions, set against a background of continuing political and economic uncertainty.