(Bloomberg) -- British private equity firm Queensgate Investments has spent $400 million to take over Freehand Hotels from billionaire Ron Burkle's Yucaipa Cos. and the Sydell Group.
Queensgate plans to manage Freehand's sites in Manhattan, Miami Beach, Los Angeles and Chicago through the Generator hostel business it acquired in 2017, according to a statement Friday. The company has also bought the Broken Shaker bars that operate within the hotels.
Queensgate intends to expand the brands into Europe and is examining deals in “London, Edinburgh, Milan, Amsterdam and other gateway European cities,” said Puneet Kanuga, the company's investment director.
Investors have been piling into lodging brands that blur the lines between hostels and boutique hotels, hoping to lure younger customers who have flocked to home-sharing websites including Airbnb Inc. These typically offer smaller rooms at a lower cost, while placing more emphasis on communal facilities.
To contact the reporter on this story: Jack Sidders in London at jsidders@bloomberg.net
To contact the editors responsible for this story: Shelley Robinson at ssmith118@bloomberg.net, Marion Dakers, Keith Campbell
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