Major European hostel group a&o is entering its twenty fifth year in business, after declaring a record business performance for 2024.
The group generated EUR192.7m of revenues in the full calendar year, achieving a respectable average occupancy of 76.6%. The group welcomed 2.8 million guests, who between them booked 6.2 million overnight stays at its 42 hostels.
A trio of openings
The portfolio continues to grow, with a&o opening three properties in the second half of 2024. The new destinations are Brighton, Antwerp, and Brussels.
Into 2025, and a&o has already opened its latest hostel, in the Italian city of Florence. It also acquired a new development site in Heidelberg, Germany where construction on a new hostel will start during 2025.
“We are entering our 25th anniversary year strong and confident and with a record financial and operational performance,” said CEO and founder, Oliver Winter. “Smart, dynamic growth that creates and delivers sustainable value remains our strategy for the future as well.”
Backed by owners StepStone Group and Proprium Capital Partners, a&o is continuing to grow. Over EUR400m has been set aside to invest in growing the business, enabling the hostel giant to snap up suitable city centre buildings, as they appear. Often, a&o will convert a property to a hostel, having acquired an empty office building.
With its annual financial results, a&o also shared some interesting details around its guest demographics. Group travellers make up more than one third of all bookings, and 40% of those group bookings are made direct. The average age of a&o guests is 18-24 years old.
The company also revealed its top performing hostel is a&o Koln Dom, which has the highest occupancy, and commands the strongest room rates; behind this hostel are next best performers Berlin Mitte, and Edinburgh. It says half of its bookings are from German guests, with Polish, Austrian and Danish guests the next most evident.
Success reducing carbon intensity
Echoing the desires of its guests to build a more sustainable business, a&o has spent many years working on its carbon reduction strategy. Indeed, over ten years, it has reduced carbon emissions by 78%. The company looks to minimise carbon at source, rather than simply paying for offset measures. It is working on building energy efficiency, reduction of food waste, and more optimisation of supply chains. The group is also extending its educational initiatives, to help share the sustainability message. An internal ESG task force helps guide the plans.
Technology, too, is a key area of investment. The a&o app has been downloaded 450,000 times, and around 70% of direct room bookings are now made on smartphones. Digital room keys are also seeing greater adoption, with 5% of guests now opting to use their phone to access their room during a stay.
