This strategic initial investment, carried out as a capital increase, is meant to accelerate Room007 Hostels & Hotels’ expansion plans. The investment can be increased, according to the company’s growth. In this way, GRC will continue supporting the creation of value in leading companies in Spain.
Room007 Hostels & Hotels is currently operating five assets in prime locations within the historical centres of Madrid, Seville and Lisbon, with a total of 168 rooms. Its assets have solar panels, aerothermal energy, energy accumulators and recycling stations, among others. In the same way, the company not only applies this way of thinking sustainably to its day-to-day activities but also to the selection of suppliers which handle the laundry, amenities, products offered at its restaurants and to all the stages of construction and rehabilitation of its establishments.
Projects under development
The company is currently expanding. Besides its current portfolio with fully operational assets, it also has five projects under development in Malaga, Seville, Madrid and San Sebastian, expected to open in 2022, adding more than 290 rooms to its management portfolio. Additionally, Room007 Hostels & Hotels has more assets under development in other enclaves in Spain and Portugal, which will add to its growing portfolio, 700 more rooms, all in prime locations in Bilbao, Valencia, Mallorca, Malaga, Porto and Lisbon among others. In total, the company expects to reach 1.200 rooms in 2023 and have a team of 250 employees in the coming three years.
The operator has different lines of business divided by types of client. On the one hand, its brand Room007 Hostels, whose moto is «be a traveller», is directed fundamentally towards a younger target (generation Z: between 18 and 25 years old approximately), whose preferences in terms of accommodation are focused on location, value for money and the availability of common areas and social activities (live music, pop up markets, yoga, restaurants, etc.). On the other hand, it has the brand Room007 Select, inspired by the moto «Natural Smart Hotels», directed towards travellers with more money who value private rooms, a minimalist aesthetic, as well as a privileged location in the centre of the city.
Ignacio Requena, Room007 Hostels & Hotels’ managing director, pointed out that «We are very happy with the support of an investor such as Global Realty Capital, with a solid bet to boost the Iberian tourism segment. At Room007 Hostels & Hotels we are developing an important growth plan for the coming years, based on the flexibility of our business model when compared to the traditional hotel offer, which had already been growing 20% per year before the pandemic».
Kaho Ha, partner at Global Realty Capital, pointed out that «The growing interest in Europe during the last few years, for hostels and boutique hotels by clients, investors and hotel chains, confirms the great potential this type of accommodation has. With this investment, the first in the hotel segment, GRC reaffirmed its commitment towards the development and professionalisation of the real estate sector and, at the same time, it reveals its firm intention of betting in the Spanish tourist segment recovery. At GRC we seek to invest in and support the most innovative and sustainable projects in Iberia».
The operation had the legal advice of Cuatrecasas and Broseta and Auric-Partners’ specialised M&A advise.