Room00 gets €400 million infusion

MADRID – Madrid-based Room00, which converts underutilized urban spaces in Southern Europe into modular, tech-driven hotels and hostels, has secured €400 million in funding from New York City-based global Investment firm King Street Capital Management to accelerate expansion through acquisitions in markets led by Madrid, Barcelona, Lisbon, Porto, Milan, Rome, and Florence.

The funding will focus on acquiring and renovating hotel properties in prime micro-locations and expand Room00’s existing growth model beyond leases and hotel management agreements. In Italy, Room00 has partnered with Kryalos SGR to establish an investment vehicle that capitalizes on Kryalos’ expertise in real estate and urban regeneration.

Founded in Madrid in 2012 by CEO Ignacio Requena, Room00’s portfolio encompasses Room00 Hostels, Room Select Hotels, and LETOH LETOH, with over 2,500 rooms and 50 assets in operation or development. Its core markets today are Spain and Portugal and Room00 recently acquired for €20 million the TOC Hostels.

Room00’s growth strategy aims to reach 200 assets and 15,000 rooms across Southern Europe within four years, including entry into the London hotel market with another 20 assets and 1,000 rooms – the first by the end of 2025.

Room00’s hybrid approach distinguishes it from competitors like Generator Hostels, The Student Hotel, Safestay Hostels, and Meininger Hotels. It merges hostels’ social, affordable atmosphere with boutique hotels’ comfort, privacy, and design in central locations.

“We view Room00 as one of the strongest, most innovative and scalable platforms in the European hospitality landscape,” said Paul Brennan, partner and co-head of Real Estate at King Street. “Its fully integrated operating model and strategic focus on prime city center locations position it as a valuable partner for our real estate growth strategy in Europe.”

“This investment from King Street validates our business model as the leading vertically integrated hotel operating and investment platform in the Southern European urban lifestyle hospitality industry and will allow us to accelerate growth via acquisitions of prime real estate, attract the best talent and open new opportunities for collaboration with investors who share our long-term vision,” Requena added.