British “alternative finance platform” Cogress has struck a deal to help Selina, the Latin American hotel/hostel hybrid, grow in Europe. Cogress will commit £80 million over the next five years to fund the hotel group’s expansion into U.K. and Portuguese markets.
The deal makes Cogress the exclusive funding partner of Selina, a venture capital-backed company with 128 properties in 19 countries, with a post-money valuation of $850 million. Selina’s model requires limited capital investment for growth, with Selina opting for conversions rather than new-build developments.
“This is the biggest commitment we have made as a lender,” Cogress CEO Tal Orly said. “The scope of Selina, its growth to date, the innovation and the resilience of the model, and its potential to change not only the hospitality industry but how we view and use property is reminiscent of Airbnb. It is an opportunity very few lenders get the chance to partner on, and I was delighted that our success to date meant Cogress was in a strong position to commit £80 million over the next five years to this deal.”
Cogress plans to raise the required funds from its community of investors. The first investment opportunity is a portfolio of six hotels, including Selina’s recently launched Secret Garden site in Lisbon, Portugal, which achieved occupancy rates of 80 percent over the summer, and a 219-room site in Porto. Several of the properties will be in the U.K., including a hotel in Manchester with three cafés and two clubs, the conversion of Liverpool’s YMCA building into a 324-room hotel and a property in Birmingham’s Jewellery Quarter, which will feature a Latino bar in the basement.