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Warning of possible hotelier market exodus

Warning of possible hotelier market exodus

Thursday 14 September 2023

Warning of possible hotelier market exodus

Thursday 14 September 2023


The Economic Development President fears that ageing hoteliers, coupled with the extreme pressures on housing, could result in a “rout” on visitor bed stock in the coming years, something which has “clear risks”.

Deputy Neil Inder confirmed to a Scrutiny hearing yesterday that there are “roughly” 5,500 beds in the sector currently, noted as being a slight drop since 2019 due to myriad reasons such as the loss of small guest houses and self-catering units.

As many are 200 beds are “temporarily” not being used for “various reasons”, he added

But Deputy Inder warned that demographic and housing market factors could see the numbers drop more going forward, and that a balance needs to be found between supporting tourism and delivering more housing.

LEree_Bay_Hotel.jpg

Pictured: The former L'eree Bay Hotel is one which has left the industry and is being redeveloped into residential units.

“I’ll give fair warning. Given the value of property at the moment, given the pressures we’ve got on housing, I’ve personally got significant concerns on where this could lead. If we continue this on, and on, and on there is no argument at all that an extra 20,000 visitors are going to pay for a runway,” he said.

“We can’t ride two horses. We can’t claim that we’re pro the tourism economy when I know there are certain members of the tourism industry, given their age range, which are looking to basically finish their time in that. And they know that means basically selling off some of their properties and turning that into accommodation. There are clear risks.

“They are going to want to cash out at some point. The difficulty we have is there could potentially be a rout because we saw that in the self-catering sector, I think around 2007.

He suggested “there is no succession plan” and sell-offs could become “the pension plan” for some owner-occupiers.

Welcome_to_Guernsey_sign_tourism.jpg

Pictured: Tourism would be the loser if housing remains high up the agenda and lucrative for those with property.

Deputy Inder himself operates four units of self-catering accommodation.

He explained how he could exit the industry, change the use of the property, and sell it: “If I pull the boarding permit from one of those units, I can basically stick it on the market for far too much money and under, I believe the planning laws, effectively in two years’ time I can prove that I’ve had it on the market. I can go to the DPA, you can’t resist it. I’ve marketed it for two years and effectively I’m not in self-catering anymore, can it be something else?"

This process was used for the approved change of use of the old L’Eree hotel into flats.

Deputy Inder did note that there is fresh investment into tourism: “Look at what is happening down at Admiral Park. Look what’s happening down at La Grande Mare. Looks what’s happening down at the Bella Luce, and recently in St Peters,” he said.

But he reiterated that the market is “mature” and “not a “blank canvas like the early Canaries”. 

Deputy Inder added that the Committee is drawing up an accommodation strategy to evaluate the state of the market.

It also recently voted to continue to allow 3% of the island’s visitor accommodation stock to house long-stay key workers following a written request from Policy & Resources.

Deputy Inder said he didn’t support this move but was outvoted.

The Development & Planning Authority has ratified this extension, according to Scrutiny member Deputy John Dyke, who also sits on the Authority.

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