Ten years after the death of Mr P.V. Doyle, the hotel empire which he founded nearly forty years ago is to be sold to the Jury's Hotel Group. The Doyle group which took pride in never selling an hotel - save its first, the Stillorgan County - is now to be sold in its entirety to its principal rival. In part, the sale reflects the trend throughout all industry to merge and consolidate in search of greater strength in the marketplace. The sale also reflects the sad reality that, in the absence of the founder, the Doyle family was not at one in how the hotel chain should be managed and developed.
It was no secret that the Doyle group was on the market. It strengthened its board with good non-executive appointments, it sold off non-core properties, there was talk about a stock market floatation and rumours of talks with Ryan Hotels. While the Doyle hotels had been much improved through the last decade, the group, as a whole, did not grow significantly. Ten years ago, the Doyle group was twice the size of Jury's. Today, the Doyle group extends to ten hotels while Jury's comprises 17. Jury's has benefited from its stock market quotation which has let it call on shareholders for expansion funds but the Doyle group suffered, for some of the last decade, from divided views on expansion strategy.
The acquisition is not likely to run up against monopolistic arguments whereas ten years ago the Government of the day would have been obliged to block it. The difference now is that there has been an extraordinary expansion of hotel space in the State, particularly in Dublin. Tourism is on a roll but much of the hotel construction owes its existence not to market research which says it's needed but to tax breaks which makes it attractive. What happens if the bubble bursts?
The new group will have a total of 29 hotels by the end of the year, 18 of them in the State but while it will be the largest Irish hotel group by far, it will fall well short of dominance. Dublin has seen hotel rooms double in the last five years to nearly 10,000. And there has been considerable development outside of Dublin, particularly in the cities. Business and tourist visitors contributes over £2 billion a year in foreign exchange earnings.
Jury's and the Doyle group will fit well together, to a point. Jury's does not pitch much for the five-star end of the market and most of its recent expansion has been in more affordable Inns. It has an Inn in Belfast and six premises in Britain. The Doyle group is predominantly Dublin-based; it has two hotels in the United States. In terms of geography it is a good fit, provided the enlarged group has sufficient management skills to drive a diffuse hotel chain offering a very wide price range. The enlarged group will have to contemplate some disposals. Having eleven hotels in Dublin will make it over-reliant on the capital's trade. Disposals will raise funds for upgrading of the remaining hotels and that will be vital. Ireland's new hotels, in most cases, have improved accommodation standards beyond recognition. This is particularly true in the five star category in Dublin where new hotels, and others planned, pose a considerable threat to existing hotels which are faced with the stark choice of rapid upgrading or losing business. P.V. Doyle's valuable legacy is being passed on but it will give birth to a new grouping which will have the strength and the resources to match the best in the business.