International investment manager Blackrock Real Assets has acquired a pan-European hostel portfolio as part of a €100 mln joint-venture with hostel operator Amistat International.
Financial details were not disclosed.
The off-market acquisition comprises a seed portfolio of three assets, with an active pipeline of another six assets, the firm said.
'This transaction presents an opportunity to gain early-mover access into an increasingly institutional but undersupplied asset class,' Thomas Mueller, European head of value-added real estate.
'The demand profile for hostels is particularly appealing given the lack of quality, modern stock in the market, which is characterised by fragmented ownership and very low brand penetration.'
Frank Orenstein, CIO and Partner at Amistat added: 'We see Amistat as a pioneering lifestyle brand that offers stylishly-designed, safe and tech-infused social hubs aimed at experience-hungry youth travellers of the 21st century.
'In our hostels we are offering shared - and private rooms, both with ensuite bathrooms, bars, dining/cooking areas, work-spaces, chill-out zones, high-tech connectivity and engaging activity programmes. For the young travellers the “living like a local” experience is gaining more and more importance.'
BlackRock Real Estate is BlackRock Real Assets' dedicated real estate investment group, managing over $23 bn (€20 bn) of private and public real estate equity and debt on behalf of investors.