Ireland Hotel Market Update
The Irish hotel market delivered a record year in 2025, with transaction volumes exceeding €1.7 billion and 66 hotels changing hands during the year.
A significant proportion of the headline transaction volume was attributable to a large portfolio purchase which was the largest hotel deal ever completed in Ireland and provided a strong signal of international investor appetite for the Irish market.
While a transaction of that scale is unlikely to be repeated in 2026, the outlook remains positive. There is no doubt that strong trading, constrained supply and continued investor appetite are creating opportunities across the Irish hotel sector.
Strong Demand and Limited Supply
Major events, such as the Oasis concerts at Croke Park and American football fixtures, coupled with increased visitor numbers drove significant demand in 2025. A similarly strong events calendar in 2026, together with Ireland’s six-month Presidency of the Council of the European Union, is expected to maintain momentum, bringing international visitors, delegations and business travellers to Dublin. The outlook for 2027 is similarly strong, with the Ryder Cup at Adare Manor providing another major international event and further boost to visitor numbers and hotel demand.
Dublin hotels recorded average occupancy of approximately 84% in 2025 (with 146 nights above 90% occupancy to April 2026), while Ireland as a whole continued to outperform the wider European market, with national occupancy of approximately 78% compared with 71% across Europe. Ireland’s appeal to international visitors continues to support demand across Dublin and the regions, with Cork, Galway and Limerick all recording growth in 2025.
Supply Constraints and Development Pipeline
The pace of new hotel development has slowed since 2023, driven by elevated construction and financing costs, planning uncertainty and the challenges of bringing new developments forward.
However, interest remains high and there is a significant development pipeline. Current market reports indicate that there are approximately 2,500 hotel rooms under construction in Dublin, with around 1,000 additional rooms expected to come on stream during 2026. Much of the new supply is concentrated in the budget, mid-market and hybrid hotel/hostel segments, with relatively limited new supply at the upscale and luxury end.
Delays affecting new development, as highlighted above, are creating a particular opportunity for the existing hotel market where investors can focus on acquiring, refurbishing and repositioning established assets rather than embarking on entirely new schemes.
From speaking with clients and stakeholders in the sector, we expect this to be an area of increased interest over the next 12 to 24 months, particularly as additional existing hotel stock becomes available.
Emergency Accommodation
A further potential source of supply is the gradual return of hotels currently being used for State-supported emergency accommodation.
The Government has confirmed that the phased withdrawal of State-contracted commercial accommodation will commence in August 2026 and be completed by March 2027. This has the potential to return a meaningful amount of hotel stock to the market. However, many properties are likely to require refurbishment before returning to mainstream hotel use, while older or obsolete stock may require more substantial redevelopment.
New Entrants, Domestic Hotel Groups and International Brands
Despite the challenges facing hotel development, 2025 and 2026 have seen continued activity from both international and domestic operators and investors.
In Dublin, The Hoxton, CitizenM and Moxy have added new rooms to the market, while international budget and hostel operators, such as a&o Hostels and Generator, continue to expand. The hostel sector has been particularly active, with approximately 1,800 hostel bedspaces in the Dublin development pipeline.
In Galway, the Hawthorn, a new five star hotel, opened its doors in June 2026, the first new purpose-built five-star hotel in Galway for more than two decades. The 412-room Sofitel Dublin Airport is also under construction and is expected to open later this year. Directly connected to the Airport, it is Sofitel’s first hotel in Ireland.
The investment market has also demonstrated strong activity across a range of domestic buyer profiles with a number of transactions in and around Dublin Airport highlighting the continued appetite for well-located, high-quality hotel assets.
