Filed under: Luxury Travel & Hotels
In Ireland, five hotels could fall victim to the impact of economic woes on their developers. Loans totaling €80 billion could push the prestigious hotels – the Shelbourne, K-Club, Ritz-Carlton Wicklow, Radisson and G Hotel in Galway – into the hands of the state. Even if the loans don't go into default, the fact that they used government relief could push control to NAMA.
Depending on how the situation unfolds, NAMA could become one of the largest hotel owners in the world, a dicey proposition for the properties given the agency's lack hospitality experience. There's a shot that 100 hotels could find their way to NAMA's portfolio according to the Irish Hotel Foundation, and others in the industry put the potential at double that amount. The problem is that these assets aren't easy to manage.
Some of the properties that could wind up in NAMA's hands fall distinctly into the luxury sector. The lowest priced hotel in the Maybourne Group comes in at €643 a night (for the Berkeley). At the Connaught, you could wind up dropping more than £8,000 a night. Given the stakes involved, some the developers will be kept on to manage the new properties, though there are cases where NAMA will bring in a new team.