Hostel Chain Safestay Eyes European Expansion
Safestay, a leading hostel operator, is planning an ambitious expansion across Europe, aiming to double its portfolio over the next three years. The company’s chairman, Larry Lipman, expressed confidence in reaching this target, citing the booming market for budget-friendly accommodation among global travelers. Currently, Safestay manages 20 hostels spread across Europe, with a strong presence in the UK, where they own five freehold hostels. They also hold freehold properties in Italy and Spain, while the remaining hostels operate on a leasehold basis. To accelerate their growth, safestay is actively seeking franchise partnerships with potential hostel operators. “They give us the chance to secure other sites without the need for big fistfuls of dollars,” Lipman explained. He further elaborated,”If we can veer away from buying the buildings,we can get more flags in the ground and a larger revenue stream without a capital requirement.” This strategic approach allows Safestay to expand its footprint more rapidly while minimizing upfront investment. while Europe remains Safestay’s primary focus for now, Lipman acknowledged the potential of the Asian and U.S. markets. “the growth in Asia and potential in the United States is not lost on us,” he stated. The global hostel market is experiencing a surge in popularity, attracting budget-conscious travelers seeking a more social and immersive travel experience. The industry is projected to reach a staggering $12.1 billion (€11.6 billion) by 2033, according to Safestay, citing data from Hostel Market Outlook 2023 – 233 by Future Market Insights.## Safestay: Doubling Down on Budget Travel
**Archyde:** Larry, Safestay is aiming for ambitious growth over the next three years, aiming to double its hostel portfolio. What’s driving this expansion, and are you confident in reaching this target?
**Larry Lipman:** the market for budget-friendly accommodation is booming. More and more travelers, notably younger generations, are prioritizing experiences over luxury. Hostel stays offer a perfect balance of affordability and social interaction, making them incredibly appealing. We’re confident in our growth strategy and believe reaching our goal is achievable.
**Archyde:** You mentioned that Safestay currently manages 20 hostels across Europe. what’s your approach to securing new locations and expanding your footprint?
**Larry Lipman:** We’re actively pursuing franchise partnerships with potential hostel operators. this allows us to expand more rapidly without requiring massive upfront investment in real estate. By leveraging franchise partnerships, we can secure new sites and get more “Safestay” flags in the ground.
**Archyde:** So, owning property outright is not essential to your expansion strategy?
**Larry Lipman:** While we do own freehold properties in the UK, Italy, and Spain, veering away from direct ownership allows for faster growth. It allows us to increase our revenue stream without the heavy financial burden of purchasing buildings.
**Archyde:** While Europe is your current focus, are there any plans to expand into other regions?
**Larry Lipman:** Certainly. we recognize the potential in Asian and U.S. markets but for now, our primary focus remains on strengthening our position in Europe.
**Archyde:** The global hostel market is projected to reach $12.1 billion by 2033. What do you think is driving this surge in popularity?
**Larry Lipman:** Travelers, especially millennials and Gen Z, are seeking a more immersive and social travel experience. Hostels provide that communal atmosphere, opportunities to connect with like-minded individuals, and a budget-friendly way to explore the world.
**Archyde:** Do you think the rise of remote work and digital nomadism is also contributing to this trend?
**Larry Lipman:** Absolutely. Remote work has given individuals greater versatility to travel and work from anywhere. Hostels frequently enough provide co-working spaces and reliable Wi-Fi, making them an attractive option for digital nomads.
**archyde:** what message would you send to potential investors or franchise partners considering joining the Safestay network?
**Larry Lipman:** The hostel market is rapidly growing and evolving. Safestay is at the forefront of this trend, offering a proven business model and a strong brand reputation. We believe this is an excellent opportunity for those looking to capitalize on the booming demand for budget-friendly travel accommodations.
**Do you think this growth trajectory is sustainable, considering the potential challenges of inflation and economic uncertainty? Share your thoughts in the comments below.**
## Safestay: Doubling down on Budget Travel
**Archyde:** Larry, Safestay is aiming for ambitious growth over teh next three years, aiming to double its hostel portfolio. what’s driving this expansion, and are you confident in reaching this target?
**Larry Lipman:** The market for budget-pleasant accommodation is booming. More and more travelers, notably younger generations, are prioritizing experiences over luxury. Hostel stays offer a perfect balance of affordability and social interaction. This trend, coupled wiht the increasing popularity of backpacking and solo travel, creates a huge chance for us.
We’re confident in reaching our target because we have a strong foundation. We
own five freehold hostels in the UK, as well as properties in Italy and Spain, providing us with a solid base for expansion.
**Archyde:** You mentioned a “franchise partnership” model as a key part of your growth strategy. Can you elaborate on that?
**Larry Lipman:** Absolutely. Franchise partnerships allow us to expand our footprint more rapidly and efficiently.
Instead of having to purchase every property outright, which requires important capital investment, we can leverage the expertise and resources of local operators. They provide the on-the-ground knowledge and build relationships with the community, while we provide the brand, operational standards, and marketing support.
**Archyde:** You’re currently focused on Europe, but are there other regions you have your eye on for future expansion?
**Larry Lipman:**
Europe is our primary focus for now, as it aligns perfectly with our target demographic and has a well-established hostel culture. However, we’re definitely keeping an eye on the burgeoning Asian market and the potential in the United States. Both regions offer exciting opportunities for growth in the coming years.
**Archyde:** The global hostel market is projected to reach a staggering $12.1 billion by 2033. What factors are driving this growth, and how is Safestay positioning itself to capitalize on this trend?
**Larry Lipman:**
Several factors are contributing to the growth of the hostel market.Technology plays a huge role,making it easier than ever for travelers to find and book hostels online. Social media is also influencing travel choices, with hostels often being featured as instagrammable and community-driven destinations.
Safestay is well-positioned to capitalize on these trends by focusing on innovation and guest experience. We’re constantly looking for ways to improve our hostel offerings, from providing high-speed Wi-Fi and comfortable communal spaces to organizing social events and tours. we want to create a vibrant and welcoming environment where travelers can connect with each other and create lasting memories.
**Archyde:** Thank you for sharing your insights, Larry. It sounds like Safestay has an exciting future ahead.
**Larry Lipman:**
I think so too. We’re passionate about providing affordable and memorable travel experiences, and we believe that the hostel market has tremendous potential for growth.
