Madrid-based Room00 grabs €400M to redefine urban hospitality across Europe

Travellers searching for affordable hotels in European city centres often face limited options that combine comfort, modern amenities, and prime locations. Property owners struggle with the high construction and operational costs of traditional hotel models. Madrid-based Room00 addresses these challenges by transforming underutilised urban spaces into modular, tech-driven hotels and hostels, offering quality stays at competitive rates in top European destinations.
Room00, a leading urban lifestyle hospitality platform in Southern Europe, has secured €400 million in funding from King Street Capital Management, a global alternative investment firm. This investment will accelerate Room00’s expansion into key European cities — Madrid, Barcelona, Lisbon, Porto, Milan, Rome, and Florence. The capital will be used to acquire and renovate hotel properties in these sought-after micro-locations, enabling Room00 to scale its innovative business model and directly acquire prime real estate.
King Street’s endorsement underscores Room00’s strength and scalability in the European hospitality sector.Paul Brennan, Partner and Co-Head of Real Estate at King Street, describes Room00 as “one of the strongest, most innovative and scalable platforms in the European hospitality landscape.” In Italy, Room00 has partnered with Kryalos SGR to establish a dedicated property investment vehicle, leveraging Kryalos’ expertise in real estate and urban regeneration.
The funding will focus on acquiring and renovating hotel properties in prime micro-locations across Madrid, Barcelona, Lisbon, Porto, Milan, Rome, and Florence. This approach expands Room00’s existing growth model beyond leases and hotel management agreements by enabling direct property acquisition. In Italy, Room00 has partnered with Kryalos SGR to establish an investment vehicle that capitalises on Kryalos’ expertise in real estate and urban regeneration.
Founded in Madrid in 2012 by CEOIgnacio Requena, Room00 was created to meet the rising demand for affordable, design-led, centrally located hostels and boutique hotels in Spain and Portugal. The company delivers a hospitality experience that combines value, comfort, and memorable service, targeting young travellers and families seeking quality city-centre accommodation.
Room00’s portfolio encompasses Room00 Hostels, Room Select Hotels, and LETOH LETOH, with over 2,500 rooms and 50 assets in operation or development. Its recent €20 million acquisition of TOC Hostels strengthens its position as a leading European hostel and boutique hotel operator. Each Room00 brand serves the growing demand for authentic travel experiences, contemporary design, and prime urban locations.
Room00’s growth strategy aims to reach 200 assets and 15,000 rooms across Southern Europe within four years, including entry into the London hotel market by 2025. This expansion is driven by Room00’s asset-light, technology-enabled operating model, ensuring efficient scaling and operational excellence.
Room00’s hybrid approach distinguishes it from competitors like Generator Hostels, The Student Hotel (TSH), Safestay Hostels, and Meininger Hotels. It merges hostels’ social, affordable atmosphere with boutique hotels’ comfort, privacy, and design in central locations. Modern interiors, high cleanliness standards, fast Wi-Fi, and welcoming communal spaces make Room00 ideal for value-conscious travellers seeking exceptional experiences.
The partnership with King Street and Kryalos SGR offers strategic advantages, including expertise in complex real estate markets and a shared commitment to sustainability. Room00’s focus on repurposing existing buildings and embracing automation aligns with current trends in sustainable urban hospitality.
Looking ahead, Room00 is set to become the defining name in European urban lifestyle hospitality. Its innovative, guest-centric model, backed by strong financing and visionary leadership, positions Room00 to lead a new wave of affordable, design-led hotels and hostels in Europe’s most dynamic cities.
As CEO Ignacio Requena notes, “This investment from King Street validates our business model as the leading vertically integrated hotel operating and investment platform in the Southern European urban lifestyle hospitality industry, and will allow us to accelerate growth via acquisitions of prime real estate, attract the best talent, and open new opportunities for collaboration with investors who share our long-term vision.”
With its ambitious expansion plans, strong leadership, and proven ability to adapt to modern travellers’ needs, Room00 is positioned to become the defining name in urban lifestyle hospitality across Europe.