A group of Irish property developers are in discussions with Royal Bank of Scotland to buy Dublin's landmark Shelbourne Hotel for an estimated €170 million

Mr Joe O'Reilly and Mr Liam Maye, who are both directors of Castlethorn Developments, are part of the group that has held talks with the bank about buying the famous hotel.

Royal Bank of Scotland acquired the property in 2001 from a consortium headed by Japanese investment bank Nomura Securities for €115 million in a sale and lease back agreement. In January of this year the Marriott International hotel group agreed a long-term lease with Royal Bank.

A spokesman for the bank declined to comment on any imminent sale yesterday when contacted by The Irish Times. Industry sources suggest the discussions are advanced and could be concluded shortly.

The talks were initiated by Mr O'Reilly and Mr Maye's consortium. Castlethorn Developments is developing the Dundrum Town Centre and the former Eircom office building in Dublin's South King Street area.

The group also owns extensive lands at Adamstown in south Lucan, which has been designated as a Strategic Development Zone.

Castlethorn - which is controlled by Mr O'Reilly, Mr Maye, Mr John Fitzsimons and Mr Brian Wallace - bought a two-third segment of the Adamstown land in 1996 and 1997 for €30 million, just before it was rezoned.

The Shelbourne, which is located on St Stephen's Green, was established in 1824. In the 1960s it became part of the Trusthouse Forte group. It subsequently was subsumed into the Granada group's Le Meridien hotels in 1996 when it purchased Forte hotels.

The Le Meridien group ran into financial problems in 2001, having accumulated an estimated €1 billion in debts. At that time it sold the Shelbourne as well as London's Grosvenor House and Waldorf Hotels to Royal Bank of Scotland.

Since then, the bank has renovated some of the properties and plans to transform the Shelbourne into a 276-room Renaissance hotel managed by Marriott on its behalf.

Earlier this year, a group of property developers won a bitter takeover battle for control of the Gresham Hotel group, which has properties in Dublin, Cork, London, Brussels, Amsterdam and Hamburg. That consortium was headed by Mr Bryan Cullen, managing director of Jackson Homes, and included Wexford-based property developer Mr JJ Murphy and solicitor Mr David Coleman.