(Sharecast News) - Hostel operator Safestay has successfully secured a long-term 20- year lease at a site in central Vienna.
Safestay told investors on Wednesday that the property, which was currently operating as a 52 room hotel on Schönbrunner Strasse 41, would be converted into a 234-bed branded hostel.
The AIM-listed group noted that as the switch from hotel to hostel was "relatively straightforward", it expects the conversion to be completed in three months and at a cost of less than €300,000.
Safestay said the acquisition represented a "significant step" in its European expansion - positioning the group to benefit from the continued growth seen in the hostel market on the continent, which by 2020 is projected to grow by 7-8% per year.
Chairman Larry Lipman, said: "Vienna has long been on our target list of cities given its global appeal.
The site is ideal for our purposes and will become an attractive premium hostel in the heart of this famous city." "We are confident it will quickly be an earnings enhancing transaction and as importantly be a significant and popular addition to our expanding network." As of 1100 BST, Safestay shares had slipped 1.27% to 38.01p.
Investors should be aware that past performance is not a reliable indicator of future results and that the price of shares and other investments, may fall as well as rise and the amount realised may be less than the original sum invested.
Walker Crips Group plc (Old Change House, 128 Queen Victoria Street, London EC4V 4BJ), registered in England, registered number 1432059, incorporates the following companies which are authorised and regulated by the Financial Conduct Authority: Walker Crips Investment Management Limited registered in England number 4774117 member of the London Stock Exchange, Walker Crips Wealth Management Limited registered in England number 3790291, Ebor Trustees Limited registered in England number 3514268, Barker Poland Asset Management LLP registered in England and Wales number OC341149.