Opened in 2007, A&O Dresden forms now part of a&o’s real estate portfolio – making it the 16th property within the Berlin Budget Group; the asset is currently undergoing extensive modernisation to bring it up to date with the new design of the hostel chain.
CEO of a&o Hostels, Oliver Winter says: “Dresden has always been one of our top performing markets – the fact that we have now been able to buy the freehold interest in that asset from Union Investment reinforces our growth strategy.”
Europe’s largest hostel provider is growing by renting or buying in attractive destinations and in typical a&o locations: central with optimal public transport connections. Since 2007, a&o had been the tenant of the 461-bed building between Dresden’s main railway station and the zoo. With this recent acquisition, the real estate portfolio of the Berlin Budget Group has now grown to 16 assets.
“We are flexible when it comes to transactions”, explains a&o´s Chief Investment Officer Henri Wilmes, “We can buy, rent and re-develop”. A dedicated construction team is currently responsible for the modernisation of entire portfolio until the end of 2020. The investment volume is worth over 30 million Euros. In addition, three new openings are planned by next spring, including Warsaw and Budapest. “Southern and Eastern Europe are currently our main focus in terms of future growth”.
Since 2017, the American investor TPG Real Estate is the owner of the a&o group, and the company is managed by its founder Oliver Winter. With more than 100,000 overnight stays this year and a market share of just under two per cent, a&o Dresden has the highest occupancy rate since 2007 with 159 rooms and 461 beds and is looking forward to a record trading year. The demand for double and group multi-bed rooms is similarly strong, with guests – including many couples – staying an average of two nights.
