Dalata to build €30m hotel along Dublin's Grand Canal
Hotel group Dalata is looking to cement its presence in the capital, with plans to build a four-star, 181-bedroom hotel close to Dublin city centre.
The company, headed by chief executive Pat McCann, has agreed to pay €11.9m for a site previously occupied by the Charlemont Clinic on the Grand Canal.
Dalata expects the total investment in the hotel project, including the site acquisition, to hit €40m.
Planning permission, with conditions, was granted by Dublin City Council last month for the site.
That includes permission for the hotel, a restaurant and business facilities, as well as three residential apartments and basement parking. That permission remains subject to a review by An Bord Pleanála.
An appeal against the granting of permission was made to An Bord Pleanála last week by Patrick and Alice Woods, of Charlemont Mall. They have cited potential noise, anti-social concerns, and possible overshadowing in his appeal.
Their residential property will be adjacent to the planned hotel.
Other objections had also been made to Dublin City Council by third parties.
Dalata, which is Ireland's biggest hotel group, will operate the proposed new property under its Clayton brand. It expects 100 people to be employed at the hotel.
The site was previously owned by UK property group U+I, formerly known as Development Securities.
It acquired it in December 2014 for €7.1m and has now realised a £2.3m (€3m) profit on the sale to Dalata, it said yesterday.
"The announcement today marks our first major profit contribution from our activities in this market," said the British company yesterday.
There's a shortage of up to 5,000 hotel rooms in the capital according to both hoteliers and tourism groups, with the shortfall unlikely to be fully addressed for a number of years.
Davy Stockbrokers analyst Robert Stokes believes the acquisition is in line with Dalata's strategy.
"They said their strategy was to use the capital to acquire hotels and then develop them, with capital expenditure both on existing assets and on new builds.
"This is their first venture into the new build space, it was fairly well-anticipated or expected by the market and it's a super location," Mr Stokes said.
"You would think from a corporate perspective once this hotel is up and running it will be very high up the priority list for corporate clients, given the location," Mr Stokes said.
Earlier in the month Dalata said its intention was to slow down its Irish hotel purchasing as it begins to shift its focus to the UK. Shares in Dalata closed up 1.8pc at €4.37 each yesterday.