Tom Walsh’s Staycity has added to its portfolio of aparthotels with two new properties, one beside Disneyland in Paris and in the other in Mestre, down the road from Marco Polo airport in Venice.
It’s not Venice proper, but the city is a short train ride away across the lagoon.
Staycity’s estate now extends to c.3,000 apartments in Dublin, Birmingham, Edinburgh, Liverpool, London, Manchester, York, Paris, Lyon and Marseille. A Berlin property is due to come online shortly and Walsh speaks of expanding the empire to 15,000 apartments by 2023.
It all started off with a single property in Temple Bar in 2004, which Walsh (pictured) rented out online on a website his brother Ger developed. Long before Airbnb arrived on the scene, Walsh started leasing apartments from developers in a job lot, tarting them up to the Staycity spec and then doing short-term lets for tourists.
The business model hasn’t changed much since then. Staycity is the accommodation operator in a property owned, funded and developed by someone else. The design spec is down to Staycity, as well as the taking on the booking risk and handling the lets.
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At the 284-room Disneyland Paris property, the developer extras include four and five-bedroom villas, outdoor heated swimming pool, gym, restaurant and 24-hour café bar.
The business threw up €68m in turnover in 2018 and operating profit of €8m. Scale that business up five times, as Walsh intends, and some serious cash will be flowing into the company’s Liberties HQ.
Tony Ryan’s family helped Walsh on his way in 2007, when they bought in for a 40% stake. When the Ryans exited the business in 2015, they seem to have done well, as there is a €28m goodwill charge referenced in the Staycity’s 2017 accounts. Buying out the Ryans loaded up the company with debt, and finance provider Proventus Capital was owed €16m in December 2017.
In the 2017 balance sheet, Staycity had net worth of €21m, intangibles of €25m and total liabilities of €27m. More importantly, operating cashflow was €7m, of which €4m went on expansion capex. Property legend Stephen Vernon likes what he sees and took a 5% stake in the venture and joined the board earlier this year. No better man to advise Walsh on sourcing the funds to meet his ambitious 15,000 rooms target.
