Brookfield Asset Management is expanding its hospitality platform with the acquisition of the European business of Generator Hostels for €776m.
The asset manager is investing through its opportunistic real estate strategy to acquire the hostel platform with 15 assets and 2,800 keys located in gateway cities across 10 countries, primarily in Europe.
Private equity manager Queensgate Investments acquired the Generator Hostels operating company and a portfolio of 14 assets from Patron Capital and Invesco Real Estate in 2017 for €450m.
At the time, Queensgate said it intended to own the portfolio for the long term and enhance operations for customers, with plans to invest €300m into adding more hostel assets.
In 2018, Generator Hostels marked its entry into the US market with its first location in Miami, while also continuing its European expansion with a new property in Madrid.
Brookfield, which has a track record of investing in and expanding European hospitality platforms such as Edyn, Selenta, Experimental Group and Center Parcs UK & Ireland, said it will pursue strategic acquisitions to drive growth for Generator.
The asset manager also said it plans to pursue third-party management agreements for new, related assets within the hostel market.
Lauren Okada Young, managing director in Brookfield’s Real Estate Group, said: “We’re excited to acquire Generator with its leading portfolio of strategically located European assets, sector-leading brand and operating platform.
“We see significant opportunity to further scale and enhance the business, drawing on our deep sector expertise, while continuing to provide guests with a unique, high-quality experience. We look forward to working alongside the team to support Generator in its next growth chapter.”
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