Shelbourne Hotel valuation jumps to €236m

The Shelbourne Hotel on St Stephen's Green

John Mulligan

KENNEDY Wilson, the US owner of Dublin’s upmarket Shelbourne Hotel, has hiked its valuation of the property by almost a quarter, to £209.3m (€236.3m) as the property benefits from a recovery in business following the pandemic.

The Shelbourne Hotel is one of the capital’s longest-established hotels. It opened in 1824.

The trophy property was bought in 2004 for €140m by a consortium that included developers Bernard McNamara and Jerry O’Reilly. The group spent about €125m refurbishing the hotel.

Kennedy Wilson acquired the Shelbourne from Nama in 2014 for about $152m and spent another €36m refurbishing it.

The five-star hotel was valued at £176.4m (€200m) at the end of 2020, compared to £186.3m at the end of 2019, with the pandemic hitting the figure.

In its annual report published on Thursday, Kennedy Wilson Europe Real Estate noted that its total gross revenue rose from £116.7m (€132.1m) last year to £154.9m last year, mainly due to what it said was a strong performance by the Shelbourne after Covid restrictions were lifted.

It confirms that the Shelbourne’s revenue last year was £38.6m (€43.7m), compared to £12.5m in 2021. Its cost of sales were £29.6m last year, compared to £15.3m in 2021.

Its net operating income last year was €16.1m, which was up from €8.4m the year before.

The Shelbourne’s average occupancy in 2022 stood at 89pc compared to 69pc in 2021.

The average daily room rate charged by the hotel soared to €410 last year from €294 in 2021, the annual report notes.

In 2019, Kennedy Wilson sold the Portmarnock Hotel & Golf Links in north Dublin for €50m to Canada's Northland Properties. Kennedy Wilson had bought the hotel in 2014 for €27m and spent €11m refurbishing the venue.

Kennedy Wilson Europe merged in 2017 with US-based Kennedy Wilson, creating a significant global property entity. The group also owns assets in Ireland such as the Stillorgan Shopping Centre in Dublin as well as a swathe of other commercial and residential properties including the Elysian in Cork.

The hotel sector in Ireland has enjoyed a resurgence since Covid restrictions were removed.

Dalata chairman John Hennessy said on Thursday that the performance of Ireland’s biggest hotel group last year had “exceeded even the most optimistic of expectations”.