Hostel owner Safestay positive it can welcome back guests under new plans

The business said common rooms including the restaurant areas will be closed and breakfasts will instead be served in boxes.

London-listed hostel owner Safestay has said it plans to reopen over the course of the year but with major changes to the experience for customers, the company said.

The business, which has nearly 5,000 beds at 20 hostels in the UK and across Europe, said it has been closed since April 1 with the majority of staff furloughed or receiving support from governments in the countries it operates.

Safestay said: “Check-in will be completed via WhatsApp, hand sanitiser gel, masks and gloves will be made available, common rooms including the restaurant areas will be closed, breakfasts will instead be served in boxes.

“A substantially increased cleaning rota will be introduced and no shared rooms will be sold, and instead rooms will be sold to individuals or groups who are known to each other.”

Bosses also revealed they have agreed an extra £5 million overdraft with HSBC and the business is positive it has enough cash to get through the coronavirus crisis.

Rents have also been suspended or reduced after negotiations with landlords helped to reduce the monthly costs to £600,000-a-month, of which half is deferred, Safestay added.

The company said: “With this as a starting point, the hostels will adapt their operating structures according to market conditions over the course of 2020 with the emphasis on matching operational costs with income. It will require flexibility and careful monitoring across all our markets.

“We believe that Safestay has the infrastructure in place to manage the re-engagement and that ultimately, we will find the route to returning our portfolio of hostels to pre-Covid-19 levels.”

Bosses also said the destruction of the hospitality sector from the lockdown could prove beneficial to Safestay, with opportunities to buy distressed independent hostels that could go bust.

The details come as the company revealed revenues for the year to December 31 rose 26% to £18.4 million, with like-for-like sales up 7%.

Occupancy levels hit 77.3%, up from 75.6% a year earlier and the average bed rate increased 5.4% to £21.40.

Losses before tax were £600,000 but on the company’s preferred adjusted measure, which strips out any one-off costs – pretax profits were £6.1 million.