The
hotel sector is now insolvent and one quarter of all rooms across the country needs to be closed down, according to a new report.
The study, commissioned by the Irish
Hotels Federation, claims that there is an oversupply of 15,000 rooms nationally.
They say that otherwise viable and established
hotels are being dragged under by newer developments being run at below cost.
The report by Peter Bacon and Associates recommends that the Government introduce tax changes in the Budget to allow
hotel investors to close down without being exposed to claw backs by the Revenue Commissioners.
In response to the
hotels' report, The Irish Banking Federation has said it is working with the other stakeholders in the government's Credit Supply Clearing Group to try develop other appropriate solutions to over-capacity in the industry.
The IBF said it supports the Irish
Hotels' Federation call for a Government Loan Guarantee Scheme to ensure liquidity for viable
hotels.
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