However, a report on the planning application stated the site "is one of major archaeological potential".
"The area is one of known archeological potential for Viking Age and Medieval deposits relating to the early settlement at Dubh Linn," wrote consultant archaeologist Mary McMahon.
She recommended no construction work be undertaken until an archeological assessment is carried out.
The council gave permission to Fanagan Funeral Directors and Mr Robert Lyne to demolish warehouses on the site and build the 232-bed hotel.
The existing buildings are used for parking cars, limousines and hearses associated with the funeral home.
As part of the granting of permission, the council imposed several conditions in compliance with Ms McMahon's recommendations.
A written report containing the results of ground assessments will now have to be forwarded to the city archaeologist.
Only one observation on the hotel plan from a member of the public was received by the council.
An adjoining business owner asked the local authority to consider "the height, scale and massing of the proposed development".
However, he said he was not against the development.
It is the latest hotel plan for the city centre as developers move away from building apartments while property prices continue to plummet.
An Bord Pleanala is currently adjudicating on a proposal by developer Harry Crosbie for a 'no star' hotel.
The council already granted permission to the hotel, which is to be located off Vicar Street in the Liberties.
The decision was appealed by the residents of Michael Mallin House.
The locals have complained about Mr Crosbie's "lack of communication" with them about the plans and they fear noise and dirt pollution during construction.
Mr Crosbie has said the hotel will be almost "monastic" in terms of its facilities and will not seek a star rating from Bord Fáilte because it will be "too basic to have any stars".
He described the rooms as "cells to sleep in with concrete walls and a very good bed with a duvet".
It is envisaged that room rates will start at €50, a snitch at current prices in the capital.