The Irish Hotels Federation (IHF) has said there is an imbalance in the supply and demand for hotel rooms in Dublin.
Tourism representatives addressed an Oireachtas Committee on Wednesday to defend the high costs of booking a stay in the city.
The IHF said the average daily rate of a hotel room in April this year was €154.31, and this average rate room was up 16.5 per cent on April 2019.
Tim Fenn, chief executive of the IHF accounted this rise in hotel rates to “spiralling operation costs”.
Mr Fenn said there have been “year-on-year increases of 88 per cent in energy, 18 per cent in food and beverage supplies, over 30 per cent in linen services and 20 per cent in insurance costs”.
Dublin city had the highest occupancy rates in Europe in April 2022 at 83.6 per cent. This was up from 18.3 per cent in 2021.
While hotel rooms are in demand, the IHF said supply is an issue.
The IHF said Dublin has 22,492 hotel and guesthouse rooms registered with Fáilte Ireland, and it estimates that 17.6 per cent of hotel rooms taken due to “Government contracted business and rooms out of service due to reduced staffing levels, staff accommodation allocations, supplier issues and refurbishment projects.”
It said supply issues are further compounded by delays in the construction sector due to the pandemic.
The representatives said for these reasons there are now more nights where occupancy in Dublin exceeds 90 per cent and the last available rooms are quoted at rates in excess of the average.
In response to the high hotel room rates in the city, Mr Fenn said, “This has given rise to significant levels of media and political commentary and misperceptions around the overall value for money in the market in Dublin, which remains competitive with our European peers.
“What is often lost in this commentary is that the vast majority of rooms currently sold have been contracted and previously booked well in advance at rates significantly below the last available rates. “
Meanwhile, according to the Irish Tourism Industry Confederation (ITIC) tourism arrivals were down 15 per cent in May compared to the same month in 2019.
It said recovery momentum is continuing although cost inflation, labour shortages and capacity shortfalls are posing challenges for the summer ahead.
