Aiden Murphy spoke at the Irish Hotels Federation sixth annual Hotel Investment Conference on 22 May at the Ballsbridge Hotel, Dublin 4
The conference provides delegates with expert market insights into important developments in the Irish hotel and finance markets. Aiden addressed delegated on the profitability, debt structures and term loan funding considerations for Irish hotels.
He spoke about the current supply and future requirements for hotels in Dublin and the rest of Ireland in regard to the Irish Tourism Industry Confederation (ITIC) Strategy for Growth to 2025 report. In this report the ITIC suggests an additional 11,000 bedrooms are required to continue to grow our tourism industry to 2025. Aiden estimates where this growth could come from, the balance between new hotel builds and funding levels required.
When examining the feasibility of hotels to meet this demand and deliver the estimated 11,000 bedrooms needed, Aiden highlighted the growth in hotel profitability between 2012 and 2017 from both a Dublin and regional perspective and using examples demonstrated the impact profitability has on supporting hotel expansion.
Taking two P&L examples, Aiden demonstrated that an 80-bed regional hotel expanding by 20 bedrooms could potentially increase EBITDA by €260k based on current profitability levels, while a 120-bed Dublin hotel expanding by 30 bedrooms could potentially increase EBITDA by €760k.
Finally, Aiden discussed financing expansion and typical loan structures in the current climate while demonstrating loan repayments. His full presentation is available to download below.
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Download Aiden's presentation.