Derry hotel sector set to expand in 2019

Duddy Group hotel Strand Road.
Duddy Group hotel Strand Road.

Derry’s hotel sector is set to expand over the next 12 months.

Research by the NI Hotels Federation (NIHF) points to a possible 25 per cent growth in terms of rooms in the city over the coming year and “more product” in the pipeline after 2020.

According to the NIHF, there are now 141 hotels in Northern Ireland with a complement of 9,177 bedrooms.

The industry body’s research concludes that a boom in business for Belfast hotels looks to have peaked with occupancy rates starting to “falter.”

It says demand for rooms “has not kept pace with the increase in supply.”

The market, however, is far from dormant with next year seeing expansion in Derry.

Janice Gault, chief executive, NIHF, says hotel expansion is a NI story. This, she says, is evidence of the tourism sector’s ability to “create employment and wealth on a region-wide basis.”

Demand, she says, is growing but this needs to be accelerated by increased promotion, a bigger marketing budget and a “proposition of scale” for NI along the lines of the Wild Atlantic Way.

“There has been a seismic change in the market and a response of equal measure is required to create new business,” she added.

Currently, in Derry, a new hotel is being built by the Duddy Group at Strand Road while a new 150-bed development at Ebrington Square has been approved by planners. The Garvan O’Doherty Group, meanwhile, also has plans for a new restaurant/hotel at Foyle Street/Shipquay Place.

Janice Gault added: “The opportunities of a well invested larger hotel sector are many, from improving the attractiveness of a destination, to enhancing the ability to attract bigger events and larger conferences.

“The local hotel sector has strong prospects. There is a good mix of international brands plus a number of unique Northern Ireland products. There’s a room to suit any budget and the customer now has more choice than ever before.”

Attracting more visitors, she says, is paramount.

“We need to increase the size of the tourism cake to ensure that each hotel gets a good slice of business. With three and a half million rooms to sell in 2019, a step change in activity is required.

“Having spent in the region of £500m, the hotel sector is keen to see a return on this investment and a realisation of the industry’s potential.”

She says the challenges, aside from growing the market, still centre on issues around skills and staffing, as well as Brexit, which has resulted in “considerable uncertainty” in the market.