LONDON: Safestay Plc (AIM: SSTY), the owner and operator of an international brand of contemporary hostels, announced the acquisition of the Hotel Lineros from Mr. Antonio Medina Molera, Ms. Carmen Fernandez Gude and A. MEDINA MOLERA, S.L.U.

The  property has 30 freehold bedrooms and is situated in the very centre of the ancient city of Cordoba, 60 miles north of Malaga. Under the Safestay brand the site will be converted into a 100 bed hostel. The cash consideration will be €2 million funded from the Group’s existing cash balance.

Hotel Lineros is a spectacular building and a natural fit with the Group’s portfolio of unique properties. Set over three floors, the property has been constructed in the local Moorish style, with an attractive atrium courtyard, large roof terrace, Moroccan marble sinks and richly decorated wood window shutters. Generating an individual ambience that is expected to appeal strongly to our target customers.

The hotel is ideally located just a short walk from Cordoba’s famous ancient mosque, La Mezquita, built in 784 A.D. and attracting 1.5 million visitors each year. The historic city centre is also a major tourist destination and a UNESCO world heritage site. The property is currently run as a hotel, and whilst undergoing a conversion process,  is expected in the eight months to 31 December 2024 to generate revenues of approximately €230,000 and EBITDA of €40,000.

On 1 May, the Company will begin a gradual conversion of the site into a 100-bed hostel, as well as a Safestay brand redecoration programme, with six of the bedrooms converted to 4-6 bed dorms, and two bedrooms changed to family rooms. Every room is already fitted with A/C and it is intended that the hostel will continue to trade through this process fulfilling all pre-existing bookings.

The acquisition is a part of building critical mass in key markets, including Spain, and follows last month’s announcement of a management contract to run the resort-based 120 bed Calpe Seafront Hostel on Spain’s Costa Blanca. Hotel Lineros is the Group’s fifth property in Spain alongside a hostel in Madrid and two in Barcelona and is the first in the popular tourist region of Andalusia.

It is expected that the new site will fit easily into the Safestay portfolio and benefit from the well tested sales and yield management systems. It will also benefit from the Group’s economies of scale and overall marketing programme which last year welcomed 848,633 guests across the portfolio.

Larry Lipman, Chairman of Safestay, said, “We are very excited with the acquisition of this unique and beautiful property in the historic City of Cordoba. It will open as Safestay Cordoba, paying homage to the UNESCO World Heritage status the magnificent city centre has. Cordoba will be our 5th property in Spain and 19th in our collection of upmarket hostels across Europe. Our guests are looking for ‘travel experiences’ and I feel confident that this unique property with its rooftop bar, central setting and Moorish charm will perfectly suit our customer base of travellers, families and schools.”

Safestay Plc has agreed to acquire Edinburgh Hostel for £4.3 million