European hostel group Safestay has added two properties in the Austrian Alps to its portfolio, as it signs its first franchise deal.
An agreement with new partner Sycomore Entwicklungen GmbH will see two existing hostel properties in Kitzbuhel convert to Safestay branding, adding a total of 70 beds to the Safestay European offering. To date, the properties have traded as Roomie Alps Design Hostel and Guesthouse Johanna.
A faster route to growth
The move to take on franchise properties is just one way that the Safestay management team can see to grow the business faster. The shift follows a proven path already taken by many international hotel brand groups, such as Marriott, Hilton and IHG, who have built massive portfolios using the asset light approach of franchising.
Safestay and Sycomore have agreed an initial five year contract, with an option to extend by another five years. Safestay will receive a guaranteed fixed payment, plus additional performance-based fees, including commission for direct bookings via the Safestay platform. Sycomore will continue to own and operate the properties.
From September 2025, the hostels will be renamed as Safestay Kitzbuhel Centre and Safestay Kitzbuhel Alpine. Both will offer year round value accommodation for visitors to this mountain resort, with locations just minutes from the main ski lift stations in the town.
In full year 2024, Safestay achieved gross bookings of 931,688 total bed nights, with more than one third of those coming via the company’s own direct booking routes.
“Our first franchise agreement is an exciting opportunity for Safestay as we continue to execute against our ambitions to double the size of our portfolio over the medium term,” said chairman Larry Lipman. “Supplementing our core freehold and leasehold expansion strategy with capital-light, flexible growth opportunities, such as franchising, offers exciting new routes to market that are financially attractive and leverage our strengths as an established, international brand in the fast-growing but highly fragmented global hostel market.”
“Our properties are in excellent locations and will benefit from Safestay’s brand and operational expertise as we elevate our offering,” said Sycomore managing director Nikolaus Kramhaller. “It is a strategic win-win that will enhance our guest experience while strengthening Safestay’s presence in one of Europe’s most desirable mountain destinations.”
Building a presence across Europe
Safestay currently has 18 properties open across Europe, with around 3,750 beds, offering a mix of shared and individual hostel accommodation. It is just opening in Calpe, Spain, and has further pipeline sites in Budapest, Hungary and in Brighton, UK.
In June 2025, the company signed a lease on a 300 bed hostel in Naples, Italy. The deal was completed with developer partner Ma Creo srl, and was the first step in a strategic partnership that aims to grow Safestay’s presence in Italy. The hostel is set within a historic monastery building in the city centre.
