The New York Times - 30.07.2019

B6 N THE NEW YORK TIMES BUSINESSTUESDAY, JULY 30, 2019

TRAVEL | WORKPLACE

They appeal to senior citizens and
millennials, business travelers and
backpackers. And they’re particularly
attractive to hotel developers, who can
pack in more guest rooms than in a
typical hotel.
They’re known as microhotels, in-
spired by the Japanese capsule or pod
hotels of 40 years ago that offered
cheap, tiny accommodations to busi-
nessmen.
The new versions — which are most
common in but not exclusive to big,
expensive cities like New York, London
and Paris — are designed, as one hotel
expert put it, down to their last square
inch. Their guest rooms are small —
often half, or less, the size of a typical
room in an urban hotel — with furniture
that often can be folded up or stowed
away, and bathrooms that usually have
showers and toilets but no bathtubs.
Wall-mounted TVs are also major space
savers.
Their rates are substantially less
than typical urban hotels’. Rates at
Moxy hotels, a Marriott brand, start, for
example, at $159 per night in the United
States.
With décor inspired by Japanese
capsule hotels and airlines’ first-class
cabins, microhotels are increasingly
popping up worldwide.
Henry Harteveldt, president of At-
mosphere Research, a travel research
company, said the process of squeezing
more rooms into a hotel resembles

what the airlines have been doing to
increase the number of seats on an
aircraft. While microhotel room rates
and basic economy airfares might be
relatively low, he said, the number of
potential customers makes them attrac-
tive to operators.
Stephani Robson, a senior lecturer at
the School of Hotel Administration at
Cornell University, agreed that the
concept of a microhotel room “is often
more about meeting the needs of devel-
opers.”
Although the size of microhotel guest
rooms is “minimalist,” Dr. Robson said,
“it does not mean they are not comfort-
able or stylish. They’re very well
planned, and they make optimal use of
every square inch.”
Another plus for developers, said
Mark Van Stekelenburg, managing
director of CBRE Hotels Advisory, is
that the design of microhotel guest
rooms makes them cheaper to clean
and maintain than larger, more tradi-
tional guest rooms.
And the microhotel concept appeals
to companies like Marriott and Hilton,
which recently introduced the Motto
brand, because it allows them “to get
more dots on the map,” said Michael
Bellisario, lodging analyst for Baird.
“The more properties and brands they
have in all cities,” the greater potential
for repeat business.
The idea of small hotel rooms arrived
in the United States in 1989. The Micro-
tel brand, introduced in Rochester,
served value-conscious guests by offer-
ing rooms half the size of traditional
hotel rooms, with rates that were also
half the cost. But industry experts do
not consider Microtel, now owned by
Wyndham, a microhotel brand by cur-
rent standards, since its guest room
sizes tend to be significantly larger
than those of most newer microhotels.
Generally, microhotels today have
guest rooms that range in size from

about 115 to 220 square feet, depending

on the number and size of beds. A typi-

cal room at an urban hotel in the United

States can range from 250 to 300

square feet.

Other large hotel companies have

rolled out their own brands: Introduced

in 2014, Marriott’s Moxy has 44 hotels

in Europe, Asia and North America

today and has signed contracts for

another 96. Hilton’s Motto, announced

last fall, has over a dozen projects un-

der development in Europe, the United

States and South America.

While another brand, Mama Shelter

— developed by former Club Med hotel

operators — considers its properties

boutique hotels, its guest rooms can be

as small as 118 square feet. There are

currently nine Mama Shelter hotels,

with 10 more under development. Accor

owns 49 percent of the brand.

Hyatt acquired its own microhotel

brand, Tommie, when it bought Two

Roads Hospitality last October.

Among the earliest independent

microhotel brands were Yotel and Pod,

which opened their first hotels in 2007.

The first Yotels were at airports in

London and Amsterdam, and their

guest rooms were designed by a British

firm that also designs aircraft cabins.

Today rates typically range from $200

to $229. Yotel has 12 properties, half

located in airports and half in cities.

Eighteen more are planned, including

a new extended-stay concept.

There are four Pod hotels in New

York, including one with extended-stay

accommodations in Times Square.

There is also a Pod in Washington,

with others to open in Philadelphia and

Los Angeles by next year.

There are now many more inde-

pendent microhotel brands, including

Hoxton Hotels, based in London; citi-

zenM, based in the Netherlands; Arlo

in New York; and the Hotel Hive,

which opened in 2017 in a former fed-

eral workers’ rooming house in Wash-

ington.

Many microhotels feature expansive

lobbies, with spaces designed for hang-

ing out; dining and drinking; and

co-working. Hive and Hoxton will soon

open dedicated co-working spaces at

some hotels.

Microhotel lobbies sometimes offer

work by local artists; food and drink

from popular local purveyors; and

activities for guests and other visitors.

Mama Shelter, for instance, offers free

access to foosball tables and photo and

video booths in the lobbies of many of

its properties, while Arlo offers digital-

detox happy hours, which are free to

guests and available for a fee to vis-

itors.

Guests staying at microhotels often

have access to loyalty program bene-

fits: Customers at Moxy, Motto, Tom-

mie and Mama Shelter hotels can or

will be able to access the benefits of

the programs of the brands’ parents,

while some independent brands —

including Yotel and Hive — offer their

own programs.

Another type of compact sleeping

accommodations, ranging in size from

30 to 56 square feet, is also now avail-

able post-security at some airports in

the United States, including Atlanta,

Dallas and Philadelphia. Minute Suites

and Sleepbox, which operate these,

charge guests by time increments that

can range from 15 to 60 minutes to

overnight. Many Minute Suites rooms

have showers, but Sleepbox provides

neither bathrooms nor showers; its

guests must use the airport’s facilities.

The experiences of guests who

stayed at two Manhattan microhotels

recently show they can appeal to a

wide variety of customers.

Sarah Yawn, 29, a Los Angeles-

based national accounts manager for a

Swedish watch company, stayed at the

citizenM Bowery hotel. She praised its

guest room décor, lobby that was “al-

most like a co-working environment,

with a lot of young professionals,” and

proximity to trendy shops.

Robert Smith, 58, is the chief finan-

cial officer of ClevR Mobility, an elec-

tric scooter company in Berkeley, Calif.

A frequent business traveler, he has

spent over 50 nights at the Moxy

Times Square hotel this year. He likes

the company of its young staff — he

called them “just happy, helpful peo-

ple” — and the guests, who remind

him of his four children, who are in

their 20s.

The staff’s attentiveness likely

stems, in part, from Mr. Smith’s re-

cently attained top-tier status in Marri-

ott’s loyalty program. The staff marked

his new status by leaving a thank-you

note, in green and red crayon, on the

mirror in his room, and presenting him

with a sweatshirt and sweatpants with

the Moxy logo.

The lasting proof of all microhotels

will come when the economy “slows,

unemployment rates increase, and

corporate and leisure travel gets cur-

tailed,” said Jan Freitag, senior vice

president of lodging insights for STR, a

hotel research firm.

Mr. Van Stekelenburg said he did not

anticipate that the attractiveness of the

microhotel concept would dim any

time soon. “We will see continued

efforts by independent and large hotel

companies. I believe they’re here to

stay.”

Dr. Robson said she did not expect to

see microhotels on suburban highways

or resort destinations. “But where real

estate costs are high and length of stay

is relatively short, they will be very

successful,” she said.

“When guests stay for more time,

they have more stuff. Microhotel guest

rooms cannot accommodate more

stuff.”

Microhotels Skimp on Size, but Not Style

The concept appeals to travelers on a budget, and to companies looking to expand their brands’ reach.

Itineraries

By JANE L. LEVERE

Clockwise from top: A room at the Moxy Times Square, a Marriott brand that is expanding

fast, with 44 hotels in Europe, Asia and North America and contracts for another 96; an

Arlo room, an independent microhotel brand in New York that has plans to open in Miami

and Washington; and the Moxy Chelsea in New York City. While their rooms are small,

microhotels often have spacious lobbies that invite hanging out and offer space for working.

MICHAEL KLEINBERG

ALI KATE CHERKIS FOR THE NEW YORK TIMES

115

The low-end square footage of most
microhotel rooms.

A practical solution

where space is pricey

and stays are short.

SAN FRANCISCO — Uber said it laid
off a third of its marketing team on
Monday, or about 400 people, as
the ride-hailing company tries to
cut costs and streamline its opera-
tions after its initial public offer-
ing in May.
The cuts, which were also an-
nounced internally on Monday,
are taking place in multiple Uber
offices around the world, the com-
pany said. The marketing team
had more than 1,200 people before
the layoffs. Uber employs almost
25,000 people globally, nearly half
of whom are based in the United
States, according to recent regula-
tory filings.
Uber declined to comment fur-
ther.
The layoffs are the latest shake-
up at Uber since it went public two
months ago. During its journey to
the public markets, the company,
which is unprofitable, faced nu-
merous questions from Wall
Street about whether it could

make money. Ride-hailing is an

expensive business, with

providers often spending huge

sums to recruit drivers and subsi-

dize trips. Those doubts ulti-

mately took a toll on Uber’s I.P.O.,

with the company’s stock falling

7.6 percent on its first day of trad-

ing on the New York Stock Ex-

change.

Since then, Dara Khosrow-

shahi, Uber’s chief executive, has

moved to make changes at the

company. In June, he pushed out

two members of his executive

team: Barney Harford, the chief

operating officer, and Rebecca

Messina, the chief marketing offi-

cer. Ms. Messina’s role was elimi-

nated, and the marketing team

was reorganized under Uber’s

communications lead, Jill Ha-

zelbaker.

In addition, Uber’s board has

been undergoing turnover. Ryan

Graves, Uber’s first employee and

a director, stepped down from the

board in May. Last week, two

more board members — Arianna

Huffington, the founder of Thrive

Global, and Matt Cohler, a venture

capitalist at Benchmark —

stepped down from their posi-

tions. Both Ms. Huffington and

Mr. Cohler had been heavily in-

volved in the departure of Mr.

Khosrowshahi’s predecessor,

Travis Kalanick, from Uber in

2017.

In a statement last week, Ms.

Huffington said she had stepped

down to focus on the growth of her

own company. Mr. Cohler said in a

statement filed with the Securities

and Exchange Commission that

he was “thrilled with the compa-

ny’s position.” Uber has not an-

nounced their replacements.

The company faces another test

on Aug. 8, when it is scheduled to

report its second-quarter earn-

ings. When Uber reported its first-

quarter results, it posted its slow-

est growth in years and a loss of

more than $1 billion.

In an email on Monday to

Uber’s marketing staff, which was

reviewed by The New York Times,

Ms. Hazelbaker said the 400 lay-

offs were taking place because the

team had grown bloated and deci-

sion-making was unclear. The

marketing team’s organizational

charts ran to more than 388 pages,

she said.

Ms. Hazelbaker added that she

planned to consolidate Uber’s re-

gional marketing teams around

the world, including in the United

States and Canada, Latin America

and the Middle East. The market-

ing team oversees ride promo-

tions, advertising campaigns and

social media.

“These changes are incredibly

difficult to make because they

have a huge impact on people’s

lives,” Mr. Khosrowshahi wrote in

an email to Uber employees.

“Many of our teams are too big,

which creates overlapping work,

makes for unclear decision own-

ers and can lead to mediocre re-

sults. As a company, we can do

more to keep the bar high, and ex-

pect more of ourselves and each

other. So, put simply, we need to

get our edge back.”

By KATE CONGER

Uber Cuts 400 From Marketing as Profitability Doubts Persist After a Weak I.P.O.

“We need to get our edge back,” said Uber’s chief, Dara Khosrowshahi.

SARAHBETH MANEY FOR THE NEW YORK TIMES

A company that was

once irresistible to

venture capitalists.