Record Investment Year For Irish Hotels With More To Come

The Irish hotel market recorded its strongest year in 2025 as total transaction volumes exceeded €1.7B, according to a new report from property adviser Savills Ireland.

The record performance was driven primarily by the €1.4B acquisition of Ireland’s largest hotel company, Dalata Hotel Group, with approximately €1B of that figure relating to Irish hotel assets. The transaction marked the largest-ever hotel deal completed in Ireland.

In total, 66 hotels changed hands during 2025, more than double the number traded in 2019, including the €86.5M sale of the Ruby Molly Hotel in Dublin.

Dublin hotels achieved average occupancy of 83%, with average daily rates reaching €175, representing a 23% increase on pre-pandemic levels. While inbound tourism was weaker in the early part of the year, visitor numbers normalised from April onwards.

Outside Dublin, hotel performance in regional Ireland continued to strengthen. Limited new supply combined with strong domestic demand contributed to significant rate growth, with average daily rates increasing by 60% in Limerick, 51% in Galway and 38% in Cork between 2019 and 2025.

Development activity remains concentrated in Dublin, where just under 1,000 new hotel bedrooms were delivered in 2025, including the opening of The Hoxton in November. A further 1,000 bedrooms are expected to come on stream in 2026, with additional supply scheduled for 2027, Savills said.

Despite this growth, occupancy levels are forecast to remain largely unchanged at approximately 82%, supported by continued tourism demand and major international events.

At Bisnow’s Hotel Outlook event at The College Green Hotel Dublin in May last year, Marriott and Accor said they were looking to increase their presence in the city and in some of Ireland’s other markets, while extended-stay specialist Staycity pledged to continue developing schemes in Ireland, backed by a more favourable debt market.

Savills expects transaction volumes to normalise in 2026, supported by stable economic conditions, easing cost inflation and continued brand expansion. A planned reduction in the value-added tax rate for food-led hospitality from July 2026 is also expected to provide a small boost to operator margins.

“2025 marked a defining year for the Irish hotel investment market," Savills Hotels and Leisure Senior Analyst Conor Clarke said in a statement. "The scale of the Dalata transaction, combined with a return of institutional capital and consistently strong operating performance, has fundamentally reinforced investor confidence in the sector. While development costs and operational pressures remain, the outlook for both Dublin and regional markets is positive.”