Queensgate to spend $320M to expand brand
Generator Hostels has been sold for $480 million to a unit of London-based Queensgate Investment. The seller was Patron Capital and its investment partner, Invesco Real Estate, in a deal that’s slated to close in May.
Queensgate says it plans to own the portfolio—which currently includes 14 locales—for the long term, enhance its operations for customers and invest more than $320 million into the European owner/operator’s expansion. Generator currently has 12 properties in operation and two under development. Totaling 8,639 beds, the chain’s locales include London, Paris, Copenhagen, Amsterdam, Miami, Dublin, Hamburg, Barcelona, Berlin Mitte, Stockholm, Madrid, Venice, Berlin Prenzlauer Berg and Rome.
“Generator has performed strongly under Patron’s ownership, during which time we have expanded the business significantly from just two hostels to 14, and have redefined the hostel concept into the design-led hospitality experience that today’s guests want,” says Keith Breslauer, managing director of Patron Capital. “We are very pleased to have sold Generator to Queensgate and are confident that the business will continue to grow and thrive under their stewardship.”
“Generator Hostels represents high-quality freehold assets, robust revenues, an attractive lifestyle brand, and material scalability opportunities,” says Jason Kow, ceo of Queensgate Investments. “Generator Hostels plays to Queensgate’s strengths of working with incumbent management to improve the customer experience, to streamline operations and to bolt on additional assets to this impressive platform.”
The hostel brand has experiences several leadership changes in the past year. Josh Wyatt, Generator’s former co-owner and chief strategic officer, left last May and joined Equinox to serve as president of the fitness club operator’s new hotel business. (He was also one of Boutique Design’s first annual Up-And-Coming Hotelier award winners in 2015.) Later last year, Generator hired Michelle Flagg as vice president of development for North America to drive the London-based hotelier’s expansion plans in that market, including its first U.S. location, which is slated to debut in Miami this year.
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