With investment in hotels and student housing becoming more mainstream in recent years, hostels are increasingly becoming an alternative asset class for investors.
The rise in this emerging sector is also a sign that that there is a growing demand for hostels beyond just backpackers who have always comprised the market.
The key questions are whether: (i) hostels will become part of the mainstream market (as hotels and student accommodation have); (ii) the hostel investment base will be largely domestic or international; and (iii) and more importantly are hostels here to stay?! Time will tell.
Hostels in the latest sign of an alternative property investment grabbing the headlines for higher-than-expected levels of growth in recent years, with sectors such as hotels and student housing also becoming more mainstream among investors.