The Irish hotel market achieved a record year in 2025, with transaction volumes surpassing €1.7bn. Strong sales, particularly in Dublin, signal robust investor confidence and continued growth in hospitality infrastructure.
According to a new report from property advisor Savills Ireland, the record performance was driven primarily by the €1.4 billion acquisition of the Dalata Hotel Group, with approximately €1.0bn of that figure relating to Irish hotel assets.
The transaction marked the largest hotel deal ever completed in Ireland and significantly altered market expectations, which had initially forecast annual volumes of €500 million to €600 million.
In total, 66 hotels changed hands during 2025, more than double the number sold in 2019. Savills noted that investor confidence improved as interest rates eased, supporting renewed activity following a period of limited transactions.
The €86.5msale of the Ruby Molly Hotel in Dublin was the first Dublin hotel investment transaction since 2022.
Hotel trading conditions remained broadly stable throughout the year. Dublin hotels achieved average occupancy of 83pc, with average daily rates reaching €175, representing a 23pc increase on pre-pandemic levels.
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.
In 2026, Savills expects transaction volumes to normalise, supported by stable economic conditions, easing cost inflation, and continued brand expansion across Ireland’s main cities.
The planned reduction in the VAT rate for food-led hospitality from July 2026 is also expected to provide a modest boost to operator margins.
Conor Clarke of Savills Hotels and Leisure shared “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, underpinned by demand, limited supply in key locations, and Ireland’s continued appeal as a tourism destination.”
