Staycity eyeing further international expansion on back of €22.5m loan boost
Irish-owned aparthotel operator Staycity will look to continue its expansion across Ireland, the UK and mainland Europe after securing fresh funding of €22.5m.
The company, which currently operates 228 serviced apartments in Dublin, has raised the funds through a flexible loan facility from Dublin-based asset management firm Dunport Capital.
Staycity is aiming to become one of the leading operators of aparthotels — serviced apartment complexes that use a hotel-style booking system— across Europe. It currently has more than 1,500 apartments in the UK and a small presence in Germany, France and Italy.
In total, across all markets, it operates nearly 3,000 apartments.
The company is not ruling out entry into other countries, but its medium term growth plan is to expand further into those countries in which it already has a presence. Ultimately, it wants to operate over 1,000 apartments in Dublin, alone, by next year.
The UK also remains a growth market for Staycity despite Brexit. The Irish company said it expects turnover for 2019 to have grown by 14% to €78m, with earnings, on an EBITDA basis, up by around 11%.
“The year was a challenging one, particularly in the UK where confidence has been fragile due to Brexit uncertainty,” said chief financial officer Wayne Arthur. “Despite these challenges we delivered a record like-for-like occupancy of 87.3%.”
Staycity’s chief executive and co-founder Tom Walsh said he was “delighted” with the progress the company made in 2019.“Not only did we deliver industry-leading occupancy levels, we’ve also gained our strongest ever guest satisfaction scores. We are on target to deliver revenues of over €100m in 2020 along with continued profit growth. The new year will see us continuing to work towards our target of operating 15,000 apartments by 2024.” he said.
Speaking last year, Mr Walsh said Staycity was preparing for all Brexit possibilities.
“Over 65% of our revenues are currently generated in the UK and we believe a hard Brexit will impact GDP and consequently reduce demand for hotel accommodation. This, along with a devaluation of sterling, is likely to create significant headwinds which we must prepare for.
“Fortunately, we do not have a large food operation and our team turnover is significantly below the industry average.”
While the Dunport funding is a loan, Staycity has attracted equity investment in the past, with Green Reit co-founder Stephen Vernon acquiring a 5% stake in the company last year and taking a non-executive seat on its board.
