Yucaipa Cos. and the Sydell Group have formed a partnership to open premium youth hostels in several major U.S. cities, according to The Wall Street Journal. The venture is planning to spend $250 million to acquire and renovate as many as 10 low-cost hotels over the next two years. It plans to reposition them as high-end youth hostels in such cities as Miami Beach, New York, San Francisco, Washington and Los Angeles.

The first luxury hostel by the partners will open next fall in Miami Beach, the Journal reports, where Yucaipa and Sydell are spending about $20 million to acquire and convert an art deco-style South Beach hotel. The hostel will offer its 350 beds for about $40 a night.

Most rooms at the luxury hostels will include four to six beds, and the properties will also be home to several amenities—including bars, restaurants, swimming pools and stylized lobbies—not typically found at youth hostels. Roman & Williams, the firm behind interiors at New York’s Ace Hotel and Standard Hotel, will be the designer, the newspaper reports.

Yucaipa is a private equity firm run by billionaire Ronald Burkle, while Sydell is a New York hotel developer and operator.