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Interview: Weldon Mather, Fáilte Ireland

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Patrick Ryan, Head of Hotels and Leisure at Colliers in conversation with Weldon Mather, Head of Accommodation and Operations Development at Fáilte Ireland

Q 1 The last 12 to 15 months has seen new words enter our lexicon such as “ unprecedented, “ changed environment”, “ once in a generational event” etc and the now generic response from business has been to “ pivot “ and “ re-purpose”. How would you articulate what has happened to Hospitality due to Covid 19, in a few key words?

Hospitality has essentially been decimated since the onset of COVID and no amount of superlatives can accurately capture the upheaval in our industry and of course the effect on society and people's livelihoods. Many businesses have had to change their business model overnight and while there are many excellent examples of innovation in our industry some businesses may not reopen. For those that do, it will be changed business landscape in terms of demand patterns, potentially reduced capacity, and additional public health safety infrastructure.

Q2 In terms of how the Hospitality Industry has responded to the challenge posed by Covid – do you think the various representative Groups such as the IHF, Vintners, Restaurants Association, ITIC etc could have responded better or done things differently that would have impacted their interface with Government and what lessons have been learned as a result?

Fáilte Ireland, as the National Tourism Development Authority, is mandated to promote the development of tourism in Ireland which requires extensive engagement with a wide range of industry constituents.

Everybody was caught unawares by the speed of the initial lockdown. When you compare Ireland against its international peers, we adapted very quickly in terms of government supports for employees and industry, while balancing this with public health messaging and protecting our national population from COVID-19.

Re-opening tourism businesses and managing their recovery in a way that is economically viable, safe and attractive for tourists and local communities will require coordination at a level not seen before. Which is why the appointment of the Government’s Tourism Recovery Taskforce, comprising of industry experts including Fáilte Ireland CEO Paul Kelly, along with significant and continued financial assistance have been such an important step in ensuring the tourism sector survives in the short term and can recover from this crisis as quickly as possible.

Q 3 Turning to that level of Government support aside from the PUP payment scheme – in particular the CRSS, Commercial Rates Waiver, VAT cut and deferral of Corporation Tax Payments – do you believe that the Government has done enough? Also, how long will those supports be needed?

The Government has rolled out a programme of financial supports to the tourism and hospitality sector over the last year, most of which had an immediate effect when launched to support the industry. Several of these schemes have already been extended including the EWSS and suspension of commercial rates charges. In the fullness of time, it will become apparent whether these supports had the intended effect but it's impossible to say yet what the long-term impact of these supports will be, given the scale and breath of this pandemic and the effect it has had on the economy. The government is constantly reviewing the expiry date of the various schemes and representations continue to be made by all stakeholders in relation to extensions and adjustments to these schemes.

Q4 This question is linked to 3 above. I am aware that there are a host of additional supports available from Failte Ireland to the Industry at large – apart from those mentioned above can you outline the keys ones for us and also indicate what the take up level has been to date?

Since the pandemic hit, Fáilte Ireland has worked closely with key sectoral bodies, government and directly with tourism businesses to ensure we provide practical and relevant supports for the industry. The first phase of the €55million Tourism Business Continuity Scheme opened for applications in February and currently phase two of the Scheme is in progress. We also launched a Restart Grant Plus scheme for B&Bs and the COVID-19 Adaptation Fund which was developed in recognition of the costs associated with re-opening.

As tourism businesses across the country prepare to reopen, we’re acutely aware that the industry requires more than just financial support. Fáilte Ireland has developed a suite of practical supports to help businesses to plan out the key elements of their recovery. These supports can be found on our extensive COVID-19 Support Hub which continues to be updated with the latest expert advice and supports across operational guidelines, sales and marketing and employee wellbeing.

Among the practical supports developed by Fáilte Ireland in the last 14 months are bespoke financial planning tools, practical supports and advice on HR and recruitment, an online Learning Hub to upskills teams and ensure customers still experience the world-class service our industry is famous for and a suite of wellbeing supports for employers and employees through this difficult time, on both a professional and personal level.

Q 5 What do you regard as the core challenges facing the Hospitality Industry at a macro level as we prepare for life when [ hopefully ] we will all be vaccinated and a “ new normal “ arrives at our doors?

The immediate challenge for the hospitality industry is to reopen in June and avoid a fourth lockdown as the costs of ramping up and reopening are significant. Covid 19 has had a substantial impact on peoples’ mindsets and our research tells us that there is now an emotional need for safety amongst people. In response to this, Fáilte Ireland developed the COVID-19 Safety Charter which along with instilling public confidence helps businesses boost trade by showcasing their commitment to providing customers with a safe space. To date close to 6,000 businesses have signed up to the charter and we have launched a new streamlined process which ensures an easier experience for Tourism & Hospitality businesses when they are applying for, or renewing, the COVID-19 Safety Charter.

Q6 Many commentators have mentioned that one of the challenges post Covid will be the recruitment of staff for the Hospitality Industry and that many of these [ particularly young people] have left or will leave the industry – do you see this as realistic challenge and obstacle to business?

Prior to COVID-19 the hospitality and tourism industry employed over 260,000 people in Ireland making it one of the largest employers and the industry with the greatest regional spread of economic activity. It is estimated that there are currently over 150,000 people claiming some form of financial support awaiting the reopening of the industry. Anecdotal reports suggest that a significant number of hospitality employees have moved to other industries where working hours and availability of shifts is more certain, such as retail and construction. It is too early to say how many employees have been lost to the industry, however it is expected there will be a skills shortage once reopening happens on a meaningful scale, which will require significant management supports and skills training. The Tourism & Hospitality Careers Oversight Group (COG) supports sustainable employment, collaboration and innovation to address labour supply and skills development issues. Fáilte Ireland chairs the COG and leads on implementation in conjunction with government departments and industry representatives.

 

Q7 It has been said that structural changes to our lifestyle will emerge post Pandemic. In other words, what was previously normal recreational behaviour in relation to travel [ domestic & international], eating out, going to the pub, visitor attractions and so many other activities that supported hospitality will change due to either fear or the virus which will still be with us or because our habits have changed. Would you agree with that or how do you see society evolving with our relationship with hospitality providers?

Consumer habits will undoubtedly have changed when industry reopens, but there will always be a demand for leisure activities including overnight breaks in hotels and other forms of accommodation that would require food and beverage service. Overseas travel by Irish citizens will rebound as the skies reopen, and domestically we would hope that a newfound appreciation of our country will have a long tail in terms of consumers wanting to revisit certain parts of the country and enjoy all that Ireland has to offer.  

Q 8 Turning to our beloved Pubs. If there is one sub sector of hospitality that has really been hit hard over the past year it is our “wet” pubs now shuttered for over a year. The evolution of the Pub as a place for us to meet and mingle had already begun to change in recent years with more emphasis on the Pub as a “ Hub” within the community, a place to have food, snacks, coffee and not just alcoholic drinks – in short what is regarded on the Continent as the “ Café Society” – do you see that trend developing here and in short what is the future for our Pub industry, especially those that do not routinely serve food?

One of the key barriers to developing the so called “café society” in Ireland is the weather but businesses and people have demonstrated an amazing ability to adapt and over the last 14 months as many of us have grown accustomed to dining outdoors and meeting for takeaway coffees. To support the development of this area in the long term, Fáilte Ireland in partnership with local authorities, recently launched a new €17 million Scheme for developing outdoor dining capacity nationwide.

Developing outdoor infrastructure is a key element of answering the consumer demand for more flexible dining options. This scheme will support the creation of outdoor dining experiences around the country that will not only benefit locals but are also attractive to domestic and overseas visitors when the sector re-opens. As outdoor dining in June returns, the sector will start to recover however there is still some way to go before we are allowed indoors.

Q 9. For the second half of 2021 it is generally accepted that hotels, restaurants and pubs will be very reliant on the domestic demand that is clearly pent up now as the vast majority of people have in effect been in one form of lock down for over a year. In addition, we know that savings are at an all-time high so that augurs well for people’s discretionary spending. However, our Visitor Attractions are heavily reliant on international arrivals and they are going to be pretty scarce on the ground in the next 12 months or so. What message do you give to the visitor attractions business now as they gear up to re-open?

It is generally accepted that international travel will be severely curtailed for the remainder of 2021, so domestic tourism will be critical to the industry for the remainder of this year. Fáilte Ireland’s research tells us that the ‘Keep Discovering’ campaign launched prior to the COVID-19 pandemic resonates even more strongly with people now and we will be rolling the campaign out at both a national and county level to drive domestic tourism when it is safe for the country to re-open.  We will also be working with tourism businesses to build improved websites and online booking capability through a new digital transformation programme. 

Q 10. Dublin has seen a terrific number of new hotel bedrooms coming on stream in recent years and even today in the midst of a pandemic there are some 4,000 bedrooms being constructed in the capital. Additionally, interest from abroad has never been higher and many brands are still seeking a footprint in the Capital City. Do you believe that this level of optimism is warranted and will all those bedrooms be finished?

Tourism will rebound and we will in time, attract over 10 million overseas international visitors which we saw at the peak, in 2019. Prior to the pandemic, Dublin hotels were operating at approximately 82% occupancy which was one of the highest in Europe and at a healthy average daily rate of around €140 across the city. As tourists return, accommodation will be required and many older, less well invested properties will need to either upgrade their facilities or look to a change of use for the property, such as longer-term residential accommodation. The proliferation of Aparthotels and purpose-built student accommodation in the larger cities is also posing challenges to the traditional hotel sector as tourists are increasingly seeking out accommodation with less emphasis on a wide range of food and beverage options onsite, with a preference for dining out and takeaway. Dublin is still an attractive city for hotel investors and high profile transactions including the Moxy Hotel which was sold in May 2021, will emerge over the coming months.

Q 11. Can you let us have your “ big picture “ forecast for the next 3 years in the industry. This is the most challenging year Ireland’s tourism sector has ever faced.

Our focus, as National Tourism Development Authority, is to guide and support resilience and survival in the short term and the recovery of the sector in the long-term. This will be done across a number of areas and will focus on administering funding schemes in order to ensure the tourism industry are supported to survive in the short term.

The main priorities for Fáilte Ireland in 2021 to support the tourism industry include the continuation of its business and employee supports with a special focus on mental health, administration of grant schemes to provide financial assistance, urban outdoor investment, and a new digital transformation programme.

Domestic tourism will be the first element to return, and this year Fáilte Ireland will make a significant investment in domestic marketing to drive domestic tourism once the country re-opens including county-specific campaigns and a focus on Dublin. Looking further ahead is certainly challenging and while tourism will recover in the fullness of time, we have never experienced anything like the restrictions in over the last year, so predictions at this stage would be somewhat premature!

 


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Patrick Ryan

Head of Hotels & Leisure

Dublin

I have spent almost my whole career in the Hospitality Industry. Initially with Inter-Continental Hotels Corporation I worked in  their New York office beofre transferring to their Europe Middle East Headquarters  in Paris and later London as the Executive Assistant to the President. After 7 years with IHG I joined specialist Surveors Christie  + Co  in London   in 1989 and trained to become a Hotels Negotiator. I subsequently became a Board Director and 10  years later was appointed Managing Director of their Brokerage and Insurance Division Christie Finance and Christie Insurance. Returning to Ireland in 2009 I joined the fledgling Agency NAMA which was being established after the financial crash and spent a further 10 years there where I was  a Senior Manager and their Hotel Sector Specialist. I joined Colliers in December 2020.

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