The company, which operates two boutique hostels in York and South London, is about to open a new hostel in London’s upmarket Holland Park.
Safestay bought a Georgian mansion in York last May and refurbished the Grade I listed building in December.
Safestay’s chairman Larry Lipman said: “It’s early days for York, but it’s looking very encouraging. We’ve seen a very strong customer response.
“All three of our buildings are listed and enjoy very nice architectural features.”
Occupancy in York was 49 per cent for the seven months under the group’s ownership. The group has spent £300,000 refurbishing the York hostel.
A night’s stay typically costs less than £25 a night. The group said that bed occupancy rose 10 per cent in 2014, and revenue per available bed rose 22 per cent.
The next move for the group will be European cities and it is looking at Paris, Amsterdam, Milan and Barcelona, among others.