Aparthotel operator Staycity has reported that a strong start to trading in the first half of this year has pushed its like-for-like sales up 2.4% in the year to July, 2019.
The group said that the push was on the back of an increase in occupancy and a rise in average daily rates (ADR).
Staycity, which now operates nearly 3,000 apartments across 12 European cities, saw occupancy grow by 2.2% during the period to an average of 86.4% across the group.
"Despite this year proving challenging for the hotel sector with increasing cost pressures, this performance demonstrates the strength of demand for our product as we continue to expand across Europe," commented Tom Walsh, Staycity co-founder and CEO. "The challenges in the UK are well documented, and although we are encouraged by the increase in occupancy for our UK-based properties, we are already witnessing a softening of demand for corporate travel."
Brexit Caution
Walsh highlighted that over 65% of the group's revenues are currently generated in the UK, and he expects a hard Brexit will impact GDP and consequently reduce demand for hotel accommodation.
"This, along with a devaluation of sterling, is likely to create significant headwinds, which we must prepare for,” he explained. "Fortunately, we do not have a large food operation and our team turnover is significantly below the industry average, therefore a rise in input inflation and any immediate restriction on European migration will have less of an impact on Staycity than other businesses in the hospitality sector."
Despite concerns over Brexit, Staycity is anticipating an 18% rise in turnover to €81 million for 2019, and an 11% boost in EBITDA to €9 million.
"We are on target to achieve our aim of operating 15,000 apartments by 2023, and I'm delighted with the recognition our two brands, Staycity Aparthotels and Wilde Aparthotels by Staycity, are receiving," Walsh concluded.
© 2019 Hospitality Ireland – your source for the latest industry news. Article by Aidan O'Sullivan. Click subscribe to sign up for the Hospitality Ireland print edition.
