The North’s hospitality sector continued to grow throughout the third quarter of the year despite a number of challenges in the commercial property market, according to the latest research from CBRE NI.

The commercial estate agent’s third quarter market report revealed another strong period for Northern Ireland hotels, with RevPAR (revenue per available room) up 8% in the first nine months of the year. year in Belfast and across Northern Ireland compared to last year. .

Exclusive to subscribers: Ask our tax expert a question about the fall budget

The hotel’s key third quarter highlights include:

• Armagh City Hotel is being put on the market with a guide price of £9 million.
• The Lodge Hotel in Coleraine is acquired by McKeever Hotel Group.
• Patrick and Edmund Simpson buy the Da Vinci Hotel in Derry
• The Londonderry Arms Hotel in Carnlough is being purchased by a consortium planning to create Ireland’s first whiskey hotel.
• Foundry Hotel opens in Belfast Cathedral Quarter

Political and economic uncertainties have contributed to slowing activity in other areas of the market, notably investment, with just £4.2 million worth of transactions during the third quarter, bringing the total for the year to £87.5 million, a drop of 68% compared to the same period. in 2023.

The office market was boosted by the integration of three serviced office centers, recording 140,096 square feet of take-up in the third quarter, but occupier demand remains selective, with a preference for high-quality ready-to-use space. rented.

Brian Lavery, Managing Director of CBRE NI, said: “The performance of the hospitality sector in Northern Ireland has been exceptionally strong throughout 2024.

“Despite broader economic challenges, we have seen substantial investment and development activity, strengthening investor and operator confidence in the region’s hospitality market.

“The combination of new developments, renovations and key transactions demonstrates the continued growth potential of this sector. »

He added: “While Northern Ireland continues to experience pockets of growth, market sentiment remains tempered by economic headwinds and uncertainty surrounding the upcoming Labor budget.

“As borrowing costs remain high and investors wait to see the full impact of planned fiscal policy changes, activity levels have slowed in several sectors.

“However, we are optimistic that the next budget and possible public spending initiatives could revitalize key areas. Significant capital is waiting in the wings and we anticipate a more active final quarter of 2024.

Although retail remains a challenging sector, recent openings and expansions by H&M, Deichmann, TK Maxx and Apple point to a more rejuvenated Belfast city centre.

And CBRE says it is aware of other new arrivals planned for 2025, which are expected to bring more retail choices across the city.

The industrial market in Northern Ireland, like much of the UK and Ireland, has been sluggish over the past quarter. There has been an increase in available inventory above 20,000 square feet, with demand for larger warehouse units slowing, while demand for units under 10,000 square feet continues to remain strong with a lack of available housing in this size range.