A&O Hostels has acquired Berlin-based Schulz Hotels as the budget accommodation group accelerates its expansion across Europe.
The deal forms part of A&O’s plan to broaden its offering in core markets and build scale across a sector it says is benefiting from stronger tourism flows and rising demand from budget-conscious travellers. The firm cited forecasts that the European hostels market will grow at 5.8% a year between 2025 and 2030.
Schulz was founded by Nizar Rokbani, Oskar Kan and Sascha Gechter, who previously set up Meininger, a hybrid hotel and hostel brand operating more than 20,000 beds across Europe. The trio will remain involved as part of a&o’s management and advisory team as the company explores brand extension opportunities.
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Schulz operates a 1,000-bed hotel at Berlin’s Ostbahnhof and is preparing a second site in the city’s Heide Quarter near the main rail station. The brand positions itself as a design-led, premium budget option with expanded amenities for both traditional hostel users and business travellers.
A&O said it had added 8,500 operational and pipeline beds over the past two years as it seeks to bring its low-cost model – aimed at families, school groups and backpackers – to more European cities. The group, founded in 2000 by chief executive Oliver Winter, recorded 2.8 million guests and 6.2 million overnight stays in 2024. In the first half of 2025 it hosted 1.4 million guests and 3.1 million overnight stays, with an occupancy rate of 73%.
The company has been backed since late 2023 by StepStone Group and Proprium Capital Partners, which supported a management buyout and have invested about €500m (£437m) in expansion during the past 18 months. Recent purchases include assets in London, Brighton, Brussels, Antwerp and Heidelberg, with further deals under way in other major European cities.
Winter said: “The combined know-how of A&O and Schulz amounts to 100 years of hostel expertise – the perfect prerequisite for further dynamic and creative growth in prime locations in European cities.
“Since 2024 we have deployed circa €500m (£437m) scaling the A&O Hostels platform and leveraging the team’s unrivalled real estate, investment and hostels experience. With a supportive investor base, and ongoing market dislocation presenting attractive investment opportunities, we are well placed to maintain this momentum in a rapidly maturing sector benefitting from compelling demographic and technological tailwinds.”
Gechter added: “We are delighted to join forces with a&o and take the expansion of Schulz Hotels to the next level. Our partnership is complementary – we share values, target groups, and ambitions. Enormous synergies are emerging in purchasing, sales, and technology, from which both brands will benefit.”
Proprium partner Philipp Westermann said: “A&O Hostels’ acquisition of Schulz Hotels marks the latest milestone in our drive for strategic growth across key European markets. Joining forces with the Schulz founders, who we have known for over a decade, will allow us to redefine what affordable travel can be.”
