A&o Hostels expands into Manchester

A&o Hostels is set to make its Manchester debut after purchasing two hotels that had previously traded under Accor’s Ibis and Novotel brands.

The European hostel operator, which has 30,000 beds under management, acquired the two hotel assets located between Deansgate and Piccadilly from Ares Real Estate funds and EQ Group.

The four storey property, totalling 13,000 sq m, previously operated under a franchise agreement with French hotel giant Accor.

A&o Hostels will embark on an £8.2m refurbishment programme across the adjoining hotels to deliver 1,218 beds across 303 rooms, 30% of which will be private, 30% for families and the rest dormitories.

The property will remain fully operational throughout the renovations, which are expected to complete in Q1 2027.

A&o Hostels’ expansion into Manchester follows the relaunch of the former DoubleTree by Hilton, Docklands Riverside in London as a 500-room hotel.

StepStone Group and Proprium Capital Partners acquired A&o Hostels in late 2023 through a management-led buyout and have since invested around £430m into the business.

The cash injection has resulted in the hostel operator adding more than 8,500 beds over the past two years across London, Brighton, Brussels, Antwerp and Heidelberg.

A&o Hostels also acquired the Berlin-based Schulz Hotels in December in a bid to bolster its growth strategy.

Oliver Winter, chief executive of A&o Hostels, said: “As one of the UK’s best performing hotel markets outside of London, attracting over 1.9 million visitors annually, we have long regarded Manchester as a key strategic target, and are therefore really pleased that we can now establish a significant footprint through this freehold acquisition.”

A&o Hostels was founded by Winter in 2000 and has since grown into a global hostel chain attracting 1.4 million guests and an occupancy rate of 73% in H1 2025.

Its UK portfolio includes properties in London, Edinburgh, Brighton and now Manchester.