Island incorporated hotel (4)
I believe the answer is:
inch
'island' is the definition.
(Irish island)
'incorporated hotel' is the wordplay.
'incorporated' becomes 'inc'.
'hotel' becomes 'h' (phonetic alphabet).
'inc'+'h'='INCH'
(Other definitions for inch that I've seen before include "One of a 2 down in a foot" , "Edge (forwards)" , "Move in tiny increments" , "Not very far" , "2.54 cm (approx.)" .)