REG - Safestay PLC - Acquisition of Edinburgh Hostel

SafestayAnnouncement

16/10/2023 07:00

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RNS Number : 1341Q  Safestay PLC  16 October 2023

 

16 October 2023

 

Safestay plc

("Safestay", the "Company" or the "Group")

Acquisition of Edinburgh Hostel

 

Safestay (AIM: SSTY), the owner and operator of an international brand of
contemporary hostels, is pleased to announce it has agreed to acquire a
freehold property in the centre of Edinburgh, which until a few years ago
operated as a hostel, for cash consideration of £4.3 million.

The property is an attractive and spacious Grade A listed building located in
the heart of Edinburgh on Cowgate Street, well known for it's lively bar and
cafe scene. Arranged over 6 floors and covering 30,000 sq ft in total, the
first three floors previously operated as a hostel , whilst the upper three
floors are let to two tenants until 2038 generating £133,000 in rent per
annum. The tenants are The Society of Advocates and the Solicitors Society
(who are the vendors), and the building is adjacent to the law courts.

The building requires general refurbishment to make it ready to re-open in
advance of the key summer market next year. Once completed, the hostel will
offer 225 beds in a variety of room combinations typically ranging from 2-8
bed rooms, some with ensuite facilities.

Edinburgh is a city the Company knows well having owned and operated a
successful 615 bed hostel for 6 years in this city until the pandemic in 2021
when it was sold for £16 million. Edinburgh is a leading European city,
attracting large numbers of tourists and visitors every year, many of whom are
looking for central and affordable accomodation.

The consideration for the acquisition is £4.3 million which will be satisfied
from the Group's existing cash resources. As a result, the Group's hostel
portfolio now consists of 17 operating hostels and with the addition of
Edinburgh, the number of beds across the portfolio increases to 3,476.

Larry Lipman, Chairman of the Group, commenting on the acquisition said:

"We never wanted to leave Edinburgh for long and are delighted to return and
link up with our other Scottish site in Glasgow. Edinburgh is a truly stunning
city and a key destination for millions of young travellers to visit. The
property is superbly postioned right in the centre with easy access to all the
main attractions and we feel confident, knowing this market as we do, that it
will be a strong contibutor to the Group.

Our trading performance over the last 18 months since we have been allowed to
trade post pandemic has shown that our market is in good health. Demand and
pricing have demonstrably increased which will increasingly benefit us as we
expand the portfolio with excellent sites such as this."

 

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as amended by The Market Abuse (Amendment) (EU Exit)
Regulations 2019.

 

 Enquries
 Safestay plc                    +44 (0) 20 8815 1600
 Larry Lipman

 Liberum Capital Limited
 (Nominated Adviser and Broker)  +44 (0) 20 3100 2000
 Andrew Godber/Edward Thomas

 Novella                         +44 (0) 20 3151 7008
 Tim Robertson
 Safia Colebrook

 

For more information visit our:

Website www.safestay.com (http://www.safestay.com)

Vox Markets page https://www.voxmarkets.co.uk/company/SSTY/news/
(https://www.voxmarkets.co.uk/company/SSTY/news/)

Instagram page www.instagram.com/safestayhostels/
(http://www.instagram.com/safestayhostels/)

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