During the first half of 2026, Ireland’s hospitality industry demonstrated resilience, with hotel revenues rising despite challenging operational conditions. The Bank of Ireland’s recent report, titled Hospitality Sector H1 2026 Insights and H2 2026 Outlook, highlights that this growth was primarily fueled by increased room rates rather than higher occupancy levels.
According to Gerardo Larios Rizo, who leads the Hospitality Sector at Bank of Ireland, daily room rates have been the main factor driving revenue per available room (RevPAR) growth in most markets. Dublin maintained robust occupancy at 82% in the first half of the year, while regional locations such as Limerick, Kilkenny, and Galway saw some of the strongest RevPAR increases.
Limerick topped the list with a 9.4% year-on-year RevPAR growth, followed by Kilkenny at 7.8% and Galway at 6.9%. Cork also experienced growth, though at a slower pace, while Belfast returned to positive performance and Derry/Londonderry continued to face market challenges.
Inbound tourism significantly bolstered the sector, with visits to Ireland rising by 18% in the five months leading up to May 2026. European tourism increased by 24%, and North American visitors grew by 15%. North American travelers remain a critical market for Irish hospitality due to their higher spending levels, with average visitor expenditure from the USA and Canada reaching €1,219 during the period.
A notable shift is occurring in accommodation availability, as tourism bed stock previously contracted by the State is gradually re-entering the market. Fáilte Ireland data indicates that registered tourism accommodation under temporary and international protection contracts has decreased from 13% of national bed stock in summer 2023 to 3.7% in May 2026.
Domestic tourism remains vital, especially in regional areas and during off-peak seasons. Irish consumers continue to support local businesses, though operators report shorter booking periods and more last-minute reservations.
The outlook for the remainder of 2026 is positive, particularly in Dublin, where occupancy is expected to stabilize at 83.8%, and RevPAR is projected to rise by 1.1% for the year. However, the report identifies consumer confidence, higher airfares, geopolitical issues, and ongoing cost pressures as key areas for operators to monitor.
Larios Rizo emphasizes that the industry’s focus should shift from volume growth to profitability. He states, “H2 is about margin conversion, not volume recovery. Trading momentum is positive, but operators will need to convert RevPAR growth into cashflow while responding to shifting supply, value-conscious consumers, and persistent cost inflation.”