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Massive Hostel Expansion in the US

Hostel Trends and News

Josh started this discussion 9 years 7 months ago

Check this out:
New Breed of Hostels Heads to U.S. (Aug 7, 2013)

Here are the big players moving into the US hostel scene:

Generator Hostels:

[Patron Capital] has raised €150 million ($200 million) to develop the business in the U.S.

St. Christophers Hostels:

Beds & Bars, a U.K.-based company that operates 20 hostels in eight European countries, is also scouting locations in five major U.S. cities, including New York, Washington, D.C. and San Francisco, for its St Christopher's Inns brand.

Ron Burkle:

Freehand plans to spend $250 million on as many as 10 U.S. locations for hostels, where a bed can be had for as little as $22 a night and private rooms start at $125.

The company recently bought a parcel of land in Williamsburg, Brooklyn, and a vintage hotel in Chicago, which it plans to convert. It is already working on a hostel in Los Angeles.

Also, Spain-based Equity Point Hostels has a hotel in New York City

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XHostelBuchares...

9 years

The biggest move will be in the northeast, as there is easy transit within and no brand associated there. Then California that USA Hostels has a good hold of, then maybe the great lakes area or south east. It is a needed bost. As the dollar weakens, people come in to spend. The demands are a little different though. Fist f he real estate is untouchable outside the realm of commercial developement. Location, location, location applies and you need 5-20 million for the property alone in a major city. Secondly the 21+ liquor liscence will really hurt revenue, so they will keep a pub/bar seperate but adjacent and offer deals to it. There are major legal and zoning hurdles for it, but it is time. Now there is a monopoly, the sole entity will reap most of the benefit from a lobby (and the hostels direct booking too) plus competition in the bus sector with the ever expanding megabus is driving prices low and making other us cities accessible. Cant wait!

Dennis

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Ington6

9 years

We open in the mountains in November. Small in comparison but our town get $1.6 million skier visits a year. We have a liquor license as well. Will go into more detail when I can.

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Rucksack Brian

9 years

Ington6, if I'm not mistaken your hostel is going to be relatively small (in size) compared to Generator, St. Christopher's, Freehand, and Equity Point. Is that right? I'm thrilled to see that the hostel growth in the US is not limited to huge hostels, despite the financial barriers that make it difficult for smaller operations to start up.

With such a boom of hostels, I don't think it will take long before the unfounded stigma starts to fade away and the general population starts to appreciate hostels. Good stuff!

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