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Undeterred by Brexit, hotelier perseveres with UK expansion
WHEN British voters opted to exit the European Union in 2016, Irish hotelier Pat McCann hit the pause button on UK expansion. Two years on, he is full of growth plans in Britain.
Dalata Hotel Group, Ireland's largest hotelier, has nine hotels in Britain, with two more planned in coming months.
Mr McCann sees four more in the UK in 2020 and two more in 2021. His decision to hold fire after the referendum left the slate empty for 2019.
"I wouldn't be concerned about the UK per se," he said in an interview in the Gibson Hotel, in Dublin's docklands. "We'll see a good robust performance."
For some, the alarm went off when Dalata said last month that trading at its UK hotels had been mixed. Still, Mr McCann put that down to Airbnb, and a hot summer deterring urban tourists, rather than Brexit. He said that he does not think that the UK will crash out of the bloc without a deal.
Instead, he sees an "endless transition", with talks continuing for a decade or more as opposed to the two years now planned. "This will go on forever," he said. "There isn't a hope" that the final trade talks will be wrapped by 2021.
Founded in 2007, Dalata controls a portfolio of about 40 three- and four-star hotels with over 7,900 rooms. The company has properties in cities such as Manchester, Leeds and London, where a key gauge, revenue per available room, fell one per cent in the first half. Its shares dropped, worsening a decline that began in July.
Mr McCann said that hot weather may have deterred some tourists from coming to London. "I love a good old wet summer," he quipped. "September saw a little bit of improvement. "
He remains "comfortable" with analysts' expectations for this year and next year. About a fifth of his profit comes from the UK, and he is planning hotels in Glasgow, Bristol, Birmingham and Manchester.
Still, he does see at least one issue in the UK linked to the Brexit vote - finding staff in London. He said: "They haven't the same numbers arriving." BLOOMBERG