Many operators of apartment-style hotels have struggled with profitability despite massive funding rounds. Yet Berlin-based Numa Group has reported numbers suggesting it’s on track to create a resilient business model as it expands across Europe.
Currently operating in 36 cities across 15 countries, the company has already signed close to 9,000 units, with the majority already operational.
“In the next four years, we want to have 15,000 units live,” Numa Group CEO Christian Gaiser told Skift.
Numa operates a hybrid model that combines aspects of traditional hotel management with short-term apartment rentals. Its properties feature fully equipped studios, digital check-in, and code-based room access, offering hotel-like consistency and the flexibility of apartment-style accommodations.
Pandemic-Forced Frugality
Launching just before the pandemic hit, Numa had little choice but to operate lean from the beginning, its executives said.
“We have practically been forced to work with as little capital as possible,” said Gaiser. “Cost culture is something you have to build early on in your business. It’s very difficult to change that a few years down the road.”
The numbers show the results of this approach: Numa’s €50 million (approximately $57 million) gross operating profit represents a 62.5% margin on its revenue. That’s an unusually high figure in the segment where many operators are believed to be posting losses.
Sustainable Growth vs. Aggressive Expansion
Unlike competitors who aggressively pursued market share, Numa has maintained a measured growth strategy.
“In this model, we believe there is a sustainability ceiling in terms of growing too aggressively,” Gaiser said.
Numa doesn’t want its properties spread too far apart so that they can be cost-effectively served with housekeepers or have their furnishings repaired and updated as needed.
“If you push too hard, things can break.”
The company has concentrated on building density in fewer strategic markets rather than widespread expansion.Â
“For example, we only aim for large metropolitan cities, reflecting 20–25% of the expansion list that other players reportedly seem to pursue,” Gaiser said.
Other operators in the sector include Limehome, Staycity, and Smartflats, all of which are pursuing variations of the apartment-hotel model.
Avoiding the Master Lease Trap
The most significant distinction between Numa and its failed competitors lies in its approach to property agreements. While Lyric, Domio, and Stay Alfred committed to long-term master leases with fixed landlord payments regardless of occupancy, Numa diversified its lease types and was more careful about being able to meet contract terms.
“We follow a strict underwriting discipline focusing on minimum profitability thresholds and rent-coverage ratios,” Gaiser said. “We also do a lot of stress-testing to evaluate the impact of demand shocks.”
When pandemic lockdowns caused occupancy rates to plummet, companies with heavy master lease obligations quickly ran out of cash while Numa survived.
The European Advantage
Numa believes Europe offers structural advantages for its business model compared to the U.S. market.Â
“The European market offered less competition than the U.S., with substantially less capital flowing in,” said Gaiser. “While many avoided the hospitality market during and after Covid, we saw this as the perfect moment to build something great when there was ‘blood on the streets.'”
The fragmented nature of Europe’s hospitality industry presents unique opportunities.Â
“Europe’s market remains highly fragmented with substantially smaller property units and fewer branded hotels,” said Gaiser. “Many family-owned hotels face succession challenges and personnel shortages, creating opportunities for tech-enabled operators.”
Numa expanded across Europe last year through both organic growth and acquisitions after the startup raised $59 million in a Series C round in 2023.Â
The UK has been a particular focus, with Numa acquiring Native Places, a UK-based operator with properties in London, Manchester, and other major cities, to accelerate growth.
Numa has also expanded in Southern Europe, adding new locations in Madrid, Lisbon, and Málaga. In Italy, it has grown its footprint with sites in Rome, Venice, and Florence.
“If we think about this notion of Europe becoming sort of the museum or the Disneyland for the American and Asian travelers, Southern Europe is probably at the forefront of this metaphor,” Gaiser said.
Accommodations Sector Stock Index Performance Year-to-Date
What am I looking at? The performance of hotels and short-term rental sector stocks within the ST200. The index includes companies publicly traded across global markets, including international and regional hotel brands, hotel REITs, hotel management companies, alternative accommodations, and timeshares.
The Skift Travel 200 (ST200)Â combines the financial performance of nearly 200 travel companies worth more than a trillion dollars into a single number. See more hotels and short-term rental financial sector performance.
Read the full methodology behind the Skift Travel 200.
