Hotel chain may add €20 a night to room rate to cover inflation and energy bills

One of the country’s largest hotel chains is adding €10 per room per night to cover the cost of its soaring energy bills and about the same again to cover wage inflation and increased food and beverage costs.

Speaking on Inside Business, a podcast from The Irish Times, Sean O’Driscoll, co-founder and a director of Cliste Hospitality, said its energy bill would double this year to €4.2 million when compared with 2019, its last full year of trading before the pandemic. “Our energy bill was €2.1 million in 2019, the last full year we were open. This year our bill will be €4.2 million… and that equates to €10 additional energy costs for every room we sell.”

Cliste owns and operates eight hotels and runs three properties for other owners. Its portfolio comprises 1,200 bedrooms and the properties include the five-star Muckross Park in Killarney; Radisson Blu hotels in Athlone, Cork, Limerick and Sligo; the Dublin One Hotel; and the Tullamore Court in Offaly.

Mr O’Driscoll said the group had also experienced increases of 15-20 per cent in its food and beverage costs and “substantial” wage inflation. “For a hotel to stand still, it probably needs to add at least €20 in rate [per night] just to cover the inflation environment at the moment.”

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He said Government supports to subsidise business energy costs – announced in the budget – would cover about 15 per cent of the increase in its bills, while energy-saving initiatives had resulted in it trimming its number of kilowatt hours used by 18 per cent since 2019.

The group’s average net room rate this year would be about €125 after breakfast and VAT and the increases to cover rising costs, Mr O’Driscoll said.