LOOP London, a new budget accommodation brand in Kensington
MCR Property Group is seeking to strengthen its presence in London’s accommodation market with the creation of LOOP London, an independent urban hostel brand whose first property will be located in Holland Park, Kensington.
The project follows the acquisition of the former Safestay London Kensington Holland Park, with the sale completed on 8 October 2026 for £3 million.
The British group plans to reposition the property around a concept combining affordable accommodation, communal spaces and a social dimension to the guest experience.
The chosen tagline, Stay in the loop, reflects the ambition to offer travellers accommodation connected to London life through both its location and its services.
The concept remains under development: MCR has not yet announced a precise reopening date under the new brand.
A historic property in the heart of Holland Park
The hostel occupies part of Holland House, a historic residence whose origins date back to the early 17th century.
The site comprises several buildings, including a wing of the Grade I-listed historic property, alongside a more recent structure resulting from alterations undertaken during the 20th century.
Its location within Holland Park, close to Notting Hill and central London, is central to the intended positioning.
The existing accommodation comprises a variety of room configurations catering to individual travellers, groups and families.
MCR plans to improve the bedrooms and communal areas while exploring additional services and ancillary revenue opportunities.
A multimillion-pound investment programme is under consideration. Its final budget and scope have yet to be determined, with any works required to take account of heritage restrictions and the necessary approvals.
MCR Property Group strengthens its London hospitality platform
For MCR, LOOP London forms part of a hospitality development strategy based on acquiring well-located assets, repositioning them and operating the properties directly.
The group already has a dedicated hospitality team in London.
In mid-2026, it launched The Kensington Collection, an accommodation offering combining hotel rooms and serviced apartments across several prestigious London neighbourhoods, including Kensington, Knightsbridge and Belgravia.
The integration of the Holland Park property is expected to draw on this existing organisation.
Creating its own brand enables MCR to retain control over commercial positioning, booking systems, the guest experience and pricing strategy.
The group presents LOOP London as a platform that could eventually extend beyond the initial Holland Park property.
However, no additional locations have been announced.
Safestay continues to reduce its property exposure
For Safestay, the transaction forms part of an ongoing disposal programme designed to strengthen its balance sheet and prioritise less capital-intensive growth.
The group had operated the Holland Park hostel since 2015 under a long-term lease expiring in 2065.
During the 12 months ended 31 December 2025, the hostel generated approximately £1.7 million in revenue and £87,000 in pre-tax profit, according to financial information disclosed when the sale was initially announced.
The transaction, legally concluded with Acerhawk Limited, was completed on 8 October 2026.
Safestay stated that the proceeds would be used to repay debt, fund working capital requirements and strengthen its financial position.
The disposal follows the sale of its Glasgow property for £5.1 million in June 2026, alongside other property portfolio adjustments.
The group has also announced the closure of its Berlin Kurfürstendamm hostel upon expiry of its contract at the end of 2026.
Its future development strategy is expected to favour franchising, leasing and partnership arrangements requiring less capital investment.
A changing London budget accommodation market
The arrival of LOOP London comes as several operators seek to reinvent budget accommodation formats in major European cities.
In London, a&o Hostels has notably strengthened its presence through the conversion of a former Hilton hotel, while Zedwell is developing compact properties based on highly efficient use of space.
These models address the same challenge: providing competitively priced accommodation in markets where property and operating costs remain high.
LOOP London differentiates itself through its historic setting and its ambition to make social interaction and shared spaces central to the guest experience.
The challenge will be to reconcile affordable pricing, the refurbishment constraints associated with a listed building and operational profitability.
LTH Analysis | Two contrasting capital strategies centred on the same asset
The Holland Park transaction illustrates two different approaches to value creation in the budget accommodation sector.
For Safestay, disposing of a leasehold interest and the associated operating business releases capital and reduces financial exposure to the operation of individual properties.
Conversely, MCR is pursuing an integrated strategy combining property investment, refurbishment, brand creation and operational management.
LOOP London’s potential will depend less on Holland Park’s attractiveness alone than on MCR’s ability to transform a heritage property into a commercially successful hospitality product.
The transaction also highlights the growing importance of long-term operating rights in hotel investment strategies, without necessarily acquiring the freehold ownership of the underlying buildings.
With the refurbishment budget, final accommodation capacity and expected financial performance still undisclosed, the economics of the repositioning remain to be established.
At a Glance
Investor and developer: MCR Property Group, United Kingdom.
New brand: LOOP London.
Property: Former Safestay London Kensington Holland Park.
Location: Holland Park, Kensington, London.
Acquisition price: £3 million.
Transaction structure: Acquisition of a long leasehold interest and associated hostel business.
Legal purchaser disclosed by Safestay: Acerhawk Limited.
Sale completion: 8 October 2026.
Lease expiry: 2065.
Heritage: Part of Grade I-listed Holland House.
Planned works: Refurbishment and repositioning, subject to consents.
Investment programme: Multimillion-pound project under development; final amount undisclosed.
Previous operator: Safestay.
Safestay 2025 revenue at the property: Approximately £1.7 million.
Safestay 2025 pre-tax profit at the property: Approximately £87,000.
Related MCR platform: The Kensington Collection.
LTH perspective: Contrasting asset-light and vertically integrated hospitality investment strategies.
