Sunday PropTech’s European Hotel Bet Has an Unexpected Profit Engine

Photo Credit: Fletcher Boutique Hotel De Mallejan in Gelderland. Fletcher Hotels Sunday PropTech has agreed to acquire Fletcher Hotels, one of the largest hotel groups in the Netherlands, giving the Indian hotel investor an established European business with 170 hotels and a long history of acquisitions. But Fletcher’s latest financial statements reveal an unusual dependence on government-funded accommodation. In the nine months to June, long-stay rooms rented to the Dutch government brought in about 17% of Fletcher’s €288 million ($321 million) revenue, but €22.5 million ($25 million) of EBITDA, a margin of about 45% against about 10% at its other hotels. That is roughly 80% of the group’s €28 million ($31 million) EBITDA, which is calculated after €23.7 million ($26.4 million) of head-office costs, according to Skift’s analysis of the company’s financial disclosures. Before those costs, long-stay is still about 44% of what the business units earn. The long-stay dip looks temporary so far, and Fletcher has added