Dalata’s proposed €455 million reverse takeover of most of the Moran Bewley group, approved by Dalata’s shareholders yesterday, is transformational for the company founded by former Jurys Doyle chief executive Pat McCann. It will transform not only the scale of its hotel room stock, but also the quality.
Dalata operates close to 40 hotels in Ireland and Britain, although it owns just seven. They are all good, solid properties, but mostly unremarkable in terms of quality or splendour.
According to recent research by HVS London, the average Dublin hotel is valued at about €180,000 per room.
The value of Dalata’s existing stock in the Irish capital, according to documents prepared for shareholders, varies from €140,000 per room for its Pearse Street Maldron property to €190,000 for its highly profitable hotel on Parnell Square. Dalata’s other owned-and-run hotels around Ireland all come in at €100,000 per room or less. The Moran deal kicks its asset base into a hi her league.
Jewel in crown
The four-star Moran hotel in Chiswick, London, is valued at three times as much as anything else in Dalata’s existing stock, on a per-room basis. McCann has agreed to pay €577,000 per room for the 10-year-old hotel.
The other London hotel in the deal, in Cricklewood, is a relative snip at €162,000 per room.
Dalata has agreed to pay €247,000 per room for the four-star Bewley’s hotel in Ballsbridge, a handsome price that reflects its glorious position on the edge of Dublin’s leafiest district.
Right across the road from the Ballsbridge property lies what was once the 197-bedroomed Four Seasons hotel, now operating as the luxury five-star Intercontinental Dublin. It is reported to be attracting tyre-kickers with a price mooted at about €50 million, or just over €250,000 per room.
Considering Dalata has agreed to pay almost €250,000 for the excellent but considerably less fabulous Bewley’s property on the adjacent corner, the Intercontinental tyre-kickers may want to revisit their sums.
The Bewley’s hotel at Newland’s Cross seems like an absolute bargain for Dalata at €91,000 per room. As does the 466-bedroomed hotel in Dublin Airport at €170,000 per room, compared with the €178,000 per room for Bewley’s Manchester airport property.
HVS is predicting Dublin hotel values will rise by a further 18 per cent to €212,000 per room by 2018. Dalata has shelled out €532 million on hotels to date, half in the capital.