Dalata to pay more than €22m per acre for Dublin development site
Dalata has spent more than €22m per acre for a site in central Dublin where it will build a hotel.
The firm - the biggest hotel group in the country - paid €8.1m for the 0.36 acre site on Kevin Street at the junction with New Street in Dublin 8. The sale price equates to more than €22m per acre - one of the highest rates paid in the country for a hotel development this year.
In a statement, Dalata said it plans to build a 137-bedroom hotel at a cost of around €26m.
The hotel will trade under the Maldron brand and is scheduled to open before the end of the year. It is expected to employ 70 people.
Dalata head of business development and finance Dermot Crowley said the deal is "a very exciting opportunity for the company and is consistent with our stated strategy of securing development sites for further new hotels in Dublin".
"The Dublin hotel market continues to perform very strongly in 2016, and we look forward to this Maldron Hotel contributing significantly to the company performance in the future."
Dalata has expanded rapidly in recent months, driven by its €455m purchase of the Morans Hotel Group in 2014. Last month it completed a €10.2m deal to buy a partially completed hotel in Cork, while in March it agreed to buy the leasehold on four hotels in including the Gibson in Dublin for €40m. It is also building a hotel on Charlemont in Dublin 2.
Broker JLL advised the vendor, Highgate Investments. Davy Stockbrokers' analysts Robert Stokes and David Jennings believe Dalata will do more deals before the end of the year.
"Dalata has spent €215m in the last eight months acquiring six hotels with a combined 1,092 bedrooms and purchasing four development sites providing an additional 654 rooms by the end of 2018.
"Dalata now has €45m left to spend, and we believe this will be spent by year end.
"On completion of this hotel in 2018, Dalata will have 3,613 rooms in the capital. This announcement is in line with the group's stated strategy to maintain a 20pc market share in Dublin and to complete the acquisition programme in Ireland by the end of 2016," they added.
Dalata shares rose 1.24pc to €4.90.