The five-star Shelbourne hotel in Dublin last year sustained a €30m revenue hit due to the impact of Covid-19.
That is according to new accounts which show that pre-tax losses at Shelbourne hotel firm, KW Shelbourne Ops Ltd last year increased more than 12 fold to €8.52m on the back of the plummeting revenues.
Underscoring the particularly severe impact of Covid-19 on the Dublin city centre hotel sector, revenues at the Shelbourne firm last year decreased by €29.48m or 71% from €42.05m to €12.2m.
The directors said the reduced turnover was as a result of Government imposed closures and restrictions in response to the Covid-19 pandemic.
They said that since the hotel re-opened in June of this year after another Government imposed closure, "domestic trade has been robust and the return of international guests has commenced".
They added that they remain confident that "the company will return to a strong trading position as international guests return to pre-pandemic levels and functions can return to full attendance."
The directors said that during 2020, both fixed and variable costs were reduced across all hotel operating lines.
"Throughout all closures, maintenance and other essential work was carried out which is usually difficult to achieve under normal trading conditions," they said.
The accounts disclose that the owner of the hotel, connected KW entity, KW Irish Real Estate VII granted a lease concession to forgive part of the rental payments agreed in an August 2019 rent review in light of the Government enforced closure of the hotel due to Covid-19.
Last year, there was zero cost under short term leases compared to €3.6m in 2019.
The impact of the lease concession on KW Shelbourne Ops Ltd's right of use assets resulted in a non-cash write down of €26.15m
The firm's loss last year takes account of non-cash depreciation costs of €4.94m.
Last year, KW Shelbourne Ops recorded operating losses of €8.13m and interest charges of €391,486 resulted in the pre-tax loss of €8.52 million.
In 2014, US real estate specialists, Kennedy Wilson assumed control of the hotel when it paid €110m for the debts attached to the property.
The staff costs for the operation of the hotel are borne by a separate company, Torriam Hotel Operating Company Ltd which has a contract to manage the hotel until 2026.
At the end of December last, KW Shelbourne Ops Ltd had accumulated profits of €2.87m.
The company’s cash finds reduced from €9.66m to €6.4m.