Hundreds of people currently accommodated at the Crowne Plaza Hotel at Northwood in north Dublin, have received letters to say that they will have to leave the facility.
The residents had been staying at the hotel as part of a contract with the International Protection Accommodation Service (IPAS), which manages the accommodation of people in the international protection asylum process.
The ending of the contract comes as the Government is struggling to accommodate increasing numbers of people arriving in Ireland from war-torn Ukraine and those seeking international protection from elsewhere.
In letters send on Wednesday, IPAS said that the accommodation "will soon no longer to available to IPAS as our contract with the hotel is coming to an end".
"Unfortunately, this means that we will need to accommodate you in another location. The moves to alternative locations will commence shortly and we will be carrying them out over coming weeks," the letter continued.
It is reported that the number of residents at the hotel affected was between 350 and 400 residents, but neither IPAS nor the hotel responded to requests for comment.
However the letter, which has been seen by RTÉ News, states that "due to the severe pressure on the availability of IPAS accommodation, we will not be in a position to take requests to moves to particular locations".
"This is because we are simply not able to fulfil these requests, given the overall shortage of accommodation," it stated.
Speaking on RTÉ's Morning Ireland Margaret Hughes, principal of Our Lady Immaculate Junior National School in Darndale, said the move would be traumatic for the children and their families.
Four students are affected by the move at the school, she said, while other children at the hotel attended other local schools and were similarly affected.
"These are lovely children who've brought a lovely richness to the school and I think it's going to be very traumatic for them.
"It's just so sad to see this happening. I think they've done so well to get this far and to get settled in, and to be in a safe place to learn and to play, and now to move again; it's a trauma in their lives yet again," she said.
The letter from IPAS advised parents that IPAS will provide "any assistance your child may need in relation to school places in your new accommodation".
Sinn Féin TD Dessie Ellis has said that every effort will be made by the community to house refugees currently in the hotel, elsewhere in the locality.
However, the Dublin North-West representative said that the task would be challenging, given the acute housing shortage in the area.
Mr Ellis said that he understood that the Crowne Plaza's contract was due to expire in mid-January but that residents would have to leave prior to that date and would likely be gone by Christmas.
"It's going to be very, very difficult within this area to house all those families. I suspect some will be found but it's going to be a very difficult job," he said.
It comes as the Cabinet is expected to consider new measures to tackle the accommodation crisis affecting refugees arriving into Ireland.
Additional reporting: Paul Cunningham, Tommy Meskill
