Dublin City Council has placed on hold plans for an eight-storey, 71-bed extension to Camden Court Hotel.
Brondsway Ltd is seeking to tap into the tourism boom in the capital and had won the support of Fáilte Ireland for the project.
The proposal includes two additional storeys on the existing six-storey hotel along with the new eight-storey block to increase the number of rooms to 322.
However, the planning authority has stalled the plan after saying it has concerns.
Some of the issues highlighted include overlooking other properties and adverse effects on daylight access.
The council has requested Brondsway to address each of the items.
During the planning process, Fáilte Ireland supported the proposal and wrote to the council.
Fáilte Ireland had told the council that “the additional tourism for Dublin city is to be welcomed because it is generating much needed revenue and employment” but added that there is “a major threat to its future because of the acute shortage of hotel bedrooms in the city centre”.
Green Liffey Ltd owns two blocks in the nearby Harcourt Business Centre and in its objection lodged by John Spain and Associates, it said it has “significant concerns” about the potential effects of the two blocks.
It said the plan can’t go ahead without the agreement of Green Liffey as the building is located directly adjacent to Green Liffey’s building.
Making the case for planning permission, Brock McClure said the applicant has made every effort at pre-planning stage to address all concerns.