Irish hotelier John Fitzpatrick has bought out the interests of his siblings in the family's two four-star properties in New York. Ciarán Hancock, Business Affairs Correspondent, reports.
The restructuring took place in July, with Mr Fitzpatrick exercising an option in the family's shareholder agreement to acquire the near 50 per cent of shares held by his brothers Patrick, Paul and Tony and his sister Eithne by 2009.
Mr Fitzpatrick declined to say how much he paid for the shares. "My father's will set out a system where we could buy each other out," he said. Mr Fitzpatrick's father Paddy died in 2002, leaving his hotel interests to his children.
Mr Fitzpatrick (47) said the properties, which are owned on a freehold basis, are currently worth €180 million or more. This is based on a value of room of $750,000-$1 million. "That is the going rate in New York at the moment," he said, adding that the stock of hotel rooms available in the Big Apple has declined by about 2,500 in recent years.
Fitzpatrick Hotels comprises the 150-bed Grand Central and 92-bed Manhattan in midtown New York. They sit on prime sites within a short stroll of Grand Central station and a string of upmarket retailers.
The Manhattan was home to David Chase, creator of hit US drama The Sopranos until last year. Chase lived in its penthouse for 2½ years during filming of the show.
The hotel group has enjoyed a bumper 2007. Mr Fitzpatrick said revenues for the 12 months to the the end of September increased to $24.9 million from $21.9 million a year earlier.
Its operating profit grew by 32 per cent to $7.3 million this year. The hotel group's pretax profit was $4 million, down from $6.2 million in 2006, a year when the group booked an exceptional gain of $3.5 million from the sale of its Chicago property to Denihan Hospitality Group.
Mr Fitzpatrick said he expected profits to rise by 10-20 per cent in 2008. He said bookings for January were up 50 per cent on the previous year. "We're looking at 80 per cent occupancy rates for January and February, which is unheard of."
The Manhattan hotel is currently undergoing a $7 million refurbishment.
He is also considering expanding the chain, possibly to Washington and Boston. "Now that I'm on my own, I can decide where we should go," he said.
Mr Fitzpatrick, who joined the family business in 1979, said the group would also look at opportunities to manage properties in the US on behalf of other owners. It manages the Fitzpatrick East 55th Street Hotel, which was formerly owned by British airline BA.
Fitzpatrick Hotels employs about 230 staff in New York.
The New York hotels operate separately from the Fitzpatrick properties in Dublin. The Fitzpatrick Castle hotel in Killiney is owned by Eithne, while Paul runs the Beacon in Sandyford and the Morgan in Dublin's Temple Bar.
