The hoteliers behind the decision to turn the D Hotel in Drogheda into accommodation for persons who arrived in Ireland to claim International Protection have already done very well – earning millions of euro so far from other properties providing accommodation for refugees, with millions more to come if the deal goes ahead.
They are under scrutiny after controversy erupted this week over a decision to turn the 113-bed ‘D Hotel’ into an accommodation centre for up to 500 asylum seekers from next month.
It has been estimated that the Drogheda hotel will “rake in” some €13 million in just one year of providing for those claiming asylum. It’s another example of how lucrative this type of accommodation provision has become, and, as we will see, how it has attracted overseas capital and investment.
The hotel, which was a key location for visitors to the Fleadh Ceoil that was hosted in Drogheda in 2019, was bought by Gleann Hospitality, which is owned by the Martello Group, in 2017. They sold it for a reported €11 million to Fairkeep in March 2023.
Fairkeep reported assets of just €100 at the end of 2022, but is owned by Polarside Limited whose joint shareholders are Keith McDermott and David McDermott.
They are also directors of Boogran Limited whose sole shareholder is Polarside.
Both Fairkeep and Boogran have received financing from the Capitalflow Group, a group of financial services companies. The accounts of both Fairkeep and Boogran show new charges being put onto their accounts, in Jan 2024 and Sep 2023 respectively, from Capitalflow Group Designated Activity Company, a holding company.
In 2022, Capitalflow Group DAC became a wholly owned subsidiary of Dutch based “disruptive leading digital bank”, bunq B.V., after its sale by Pollen Street Capital (PSC) Ltd.
At the end of 2022, Capitalflow Group DAC registered assets of €506.43 million, against €521 million in liabilities.
PSC is UK-based and describes itself as an “alternative investment management company,” among whose specialities are real estate. PSC say they have been able to deploy “bunq’s significant user base, geographic footprint, and access to deposit funding with Capitalflow’s high-quality multi-asset origination capability and strong presence in the Irish market”.
PSC control Capitalflow Holding DAC, which owned 9.96% of bunq B.V. shares as of the end of 2022.
These are the massive investment companies and banks now involved in the game in Ireland through their funding of the companies who are buying up hotels and, instead of providing tourist accommodation and boosting the local economy, are making a killing on offering the buildings to the state to house those claiming asylum.
Boogran owns the Carnegie Court Hotel at North Street Swords in north county Dublin. The hotel has provided accommodation for Ukrainian refugees under Temporary Protection since mid 2022,
Since then, Boogran has drawn down more than €4,600,000 in payments from the Department of Children, Equality, Disability, Integration and Youth (DCEDIY). Even bigger revenue streams could be expected from Drogheda.
According to the Irish Mirror:
The owners of the D Hotel in Drogheda will rake in just under €13 million a year for housing over 400 refugees.
They have agreed a daily rate of 78 euro per person and will be putting four in a room in the 113-bedroom hotel.
The previous owners were getting an average rate of 100 euros per room per night and making a profit of a million a year.
But under their new two-year deal with the Department of Integration, they will get a rate of 312 euro a night. Based on full occupancy over the course of a year, it works out at €12,868,440.
A source close to the deal said: “This is a bad deal for taxpayers – the state is effectively paying 312 euro per room per night when the previous owners were getting 100 euros.
The purchase of the D Hotel in Drogheda and the subsequent decision of its new owners to seek to eschew the provision of accommodation for tourists and other visitors to the town in favour of providing accommodation for refugees is part of a clear pattern.
As we previously reported in regard to the owners of the Blarney Stone guesthouse in Cork, usually when a company invests in a local business there is a positive multiplier effect. That is certainly the case when a hotel opens in a town and brings additional footfall to other retailers and service providers.
The opposite would seem to be the case with asylum accommodation, where tourists and all the benefits they bring to ancillary small businesses are substituted with a whole new class of state dependents.
The announcement for Drogheda has been greeted with predictable and understandable local reaction. The benefits of opting for state-funded accommodation with its low risk and higher returns on the part of the owners is pretty obvious. This also explains why the companies and those who finance the acquisitions regard the sector as so attractive.
The consequences for the local community and local businesses are less obvious, perhaps. And in common with other towns, such as Arklow last weekend, Drogheda will see a protest march tomorrow in the town as many people in local communities have quite clearly had enough.