LONDON (ShareCast) - (Sharecast News) - Hostel operator Safestay has entered into a joint-venture partnership with Maltese firm EOS Sicav to develop a 660-bed hostel in Venice.
Safestay will acquire 50% of the freehold site for €2.1m, satisfied in cash from the company's existing resources, and split the development costs with EOS straight down the middle.

Once completed, Safestay will lease the hostel from the JV partnership and be the sole operator.

The AIM-listed group said the site covers 6,000 square meters and is located on Via Fratelli Bandiera, near the city's main railway terminal, Mestre Station.

Construction was scheduled to begin in 2020 once final licensing has been confirmed. Safestay expects its share of development costs to be roughly €5m.

Chairman Larry Lipman said: "We have been working closely with EOS Sicav plc for some time to achieve this, as the potential is clear and the number of similar opportunities are few.

"Italy is a natural market for us and we are continuing to look for similar opportunities in the other popular Italian cities."

As of 0845 BST, Safestay shares had fallen 3.17% to 30.50p.

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