European hostel group Safestay has signed a strategic partnership with a leading Indian hostel operator, Zostel Hospitality.
The cross-continent connection aims to create a mutual benefit, driving more reservations to both parties. By combining their portfolios, the hostel alliance will be able to offer adventurous travellers a choice of properties with a total of more than 8,000 beds, across Europe, India and the UK.
Exploiting Growth in Indian Visitors to Europe
The logic behind the deal is clear, when you see the numbers travelling from India into Europe. The volume of visitors was up 17% year on year, and providing those travellers with an easy to understand budget accommodation option is key.
“This partnership with Zostel represents an exciting strategic development in extending Safestay’s international reach through a scalable, capital-light model,” explained Safestay chairman Larry Lipman. “By aligning with a leading hostel operator in India with aligned values, we will access new customer segments and strengthen our position in key long-haul travel markets. We believe it is a strong commercial fit between two complementary hostel networks with a shared focus on quality, value, safety and guest experience.”
Both companies will retain their existing branding, but will promote each other’s inventory via their own channels and websites. By making it easy to book, their approach will remove one key point of friction for travellers planning an international trip.
Safestay’s focus on expanding via an asset light model contrasts with alternative approaches being taken by others in the sector. Germany’s a&o Hostels is deploying capital to acquire properties, recently buying hotels in London and Manchester for conversion to their hostel format.
At a&o, expansion in Germany remains a strong focus. The group has signed additional pipeline projects in Heidelberg, and at Checkpoint Charlie in Berlin. There, an office conversion is planned, to deliver a substantial hostel with 610 rooms. Backed by investors StepStone Group and Proprium Capital Partners, a&o will invest around EUR40 million developing this new German flagship site.
Also expanding in the hybrid accommodation space is Meininger, which recently signed a lease on a property in Porto, Portugal. The property is under development and has been acquired by investor Covivio. Meininger is also close to opening a property in Edinburgh, where an office building has been converted to create a hostel. The company’s pipeline also includes German sites in Kiel and Berlin, plus Dublin in Ireland.
A Leading Asian Hostel Operator
Avril Gupta, chief executive of Hostel, added: “Through our partnership with Safestay, our community of nearly 3 million travellers will now have that across 22 European cities. In turn, Safestay’s guests will gain access to more than 100 destinations across India, Nepal and Thailand through Zostel.”
Safestay currently operates 21 sites across Europe, with 20 hostels and one hotel. Zostel has over 100 properties across India, Nepal and Thailand. In addition to its mainstream hostel offering for backpackers, the group offers a higher tier of hostels, Zostel Plus, as well as homestays under the Zostel Homes sub brand.