In 1993, the Fitzpatrick family were busy running hotels in Dublin, Cork, Shannon and New York when Eithne Fitzpatrick, wife of company founder, Paddy, died suddenly.
She had been active in the business and her death made the family realise that with five children to consider, it was time to start thinking about succession planning.
"We had all worked in the business and each of us had to decide where our focus lay into the future," says daughter Eithne Scott-Lennon, proprietor of the Fitzpatrick Castle Hotel in Killiney.
“We all had equal shareholdings and John and Paul and myself decided to stay in the hotel business. Patrick and Tony decided to pursue other family business interests.
“Paul took over the Shannon Shamrock and has since opened the Beacon hotel in Sandyford and the Morgan hotel in Temple Bar. John chose to grow the US business through our hotels in Manhattan and Grand Central and I took over the Castle. We each have different styles as hoteliers and this arrangement gave each of us our autonomy.”
The late Paddy Fitzpatrick opened the Castle Hotel in Killiney in 1971 and Eithne Scott- Lennon has been running it since 2002. It is one of south Dublin's landmark hotels, with 115 bedrooms, two bars, two restaurants, function rooms and a leisure centre with 1,500 members. The hotel has 43 full-time and 60 part-time staff, fewer than half the number of full-time staff employed before the crash.
Drastic changes
"There have been some pretty drastic changes here since 2007-08," Scott-Lennon says. "Turnover dropped dramatically from about €10 million to €6.8 million and we had no option but to cut overheads to ribbons and to take some very tough decisions, particularly in relation to staff.
“In the aftermath you still have a team to motivate and that’s difficult when morale is low. I come from a sales and marketing background and I’m used to facing forward dealing with customers.
“During the last few years, I have needed to spend as much time facing inwards managing staff and making sure we are all on the same page.”
One of the harshest things she had to hear in recent years was from a financial adviser to put herself in the shoes of a potential receiver. “I found that absolutely shocking and vowed to fight every inch of the way to make sure it never happened.”
Scott-Lennon says traditional hoteliers have been put under intense pressure by what she calls “key-jangling operators” running hotels on behalf of Nama and the banks.
“Their whole focus is cash flow and they have wrecked the value of rates and margins,” she says.
Scott-Lennon says finding money for upkeep and refurbishment has become a juggling act. “We really need the banks to loosen up and release funds for capital expenditure or the Irish tourism product will get very shabby very fast.
“We recently did a big job on the roof – something no one sees but you have no choice – and we put in a new lobby carpet because the lobby creates the critical first impression of your premises.
“We agonised over the cost and negotiated directly. In better days you’d have had an interior designer doing this. The good part is that suppliers have become more competitive and service has improved.”
Roughly half the guests at Killiney Castle are Irish, with a very loyal customer base in Northern Ireland. About 35 per cent of leisure business is repeat. The hotel also has a sizeable amount of corporate business generated by local companies and nearby multinationals.
“We try to be as involved as possible with the local business community and in turn they support us. We have always been very active in terms of meeting customers and prospective customers but since the recession we have more than doubled our efforts and have some sort of promotional activity scheduled every month,” she adds.
Scott-Lennon says the company has become very flexible about membership of the leisure centre. “We noticed a fall- off in full family memberships so, instead of joining for a year, someone can now join for a month or six months and can just have a gym membership or just a swimming membership – whatever suits them.”
She runs the hotel with a senior management team of 12 including her son, Mark. “It’s good to see the third generation coming along and I am hopeful about the future,” she says. “Turnover will be around €7.25 million this year and we are finally coming back into profit, but is still very tough.
“I think the most important thing is to get out there, make people aware that you’re very much alive and kicking and that you want their business.”
