Hotels in the west suffer sharpest price falls in 2011

Hotels in the west suffer sharpest price falls in 2011

Hotels in the west of Ireland suffered the sharpest falls in prices in 2011 compared to any other pubs or hotels in other areas of the country.

In Connaught and Ulster, hotel prices fell 45% in 2011, exacerbating the falls of 30% and 32.5% seen in the previous two years. This is among the findings of the latest property survey by the Society of Chartered Surveyors Ireland (SCSI).

In contrast, prices for Dublin hotels, restaurants and prime rural pubs confined their falls in a range of between 2% and 4% after recording falls of 20% plus in the previous two years.

SCSI members reported many closures of pubs in 2011 due to loss of business to off-licences. The low levels of sales also makes it difficult to assess realistic prices for pubs.

Georgian offices showed the sharpest decline in values in the Dublin office market in 2011 with yields extending from 8.5% to 9.1%. In contrast, yields for prime Dublin offices slipped from 7.4% to 7.5%.

Munster offices fared worse with Georgian yields extending from 9% to 10%, while prime Munster office yields extended from 8.2% to 8.7%.

SCSI vice-president, Roland O’Connell, said activity in the commercial property market was low in 2011 primarily due to a lack of confidence, difficulties in accessing finance and the uncertainty in the market about a potential retrospective banning of upwards-only rent reviews in pre-2010 leases.

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