Poshtels, unlike traditional hostels, are characterized by a small sleeping area, which is often shared, and an innovative focus on communal areas.

Graham Craggs is the Managing Director for EMEA Hotels of JLL. He says, “This hostel has been reimagined to meet the needs of today’s traveler.” It offers a flexible room product and often organized events to encourage guests to meet and mingle.

Independent properties are paving the way with innovative concepts like The Wallyard, a Berlin hostel that combines a design-hotel aesthetic with dormitory accommodations, a cafe, and bike rental. Two GRIDS hostels in Japan emphasize their role as “travelers’ centers” with comfortable communal areas and a variety of basic but attractive accommodations, including pods.

Copenhagen’s Urban House, a hotel/hostel hybrid, has bunk beds, private rooms, and a bike shop. It also offers a self-service kitchen, free walking tours, and a tattoo parlor. The focus is on social spaces and immersive experiences, with a variety of local cultural events, such as vintage markets or music concerts, anchoring the experience.

Big brand’s eye posters

Craggs says that “a number of major brands” are looking to enter this market. The so-called “poshtel” is a way to tap into the young market’s spending power and also to respond to Airbnb, which has disrupted the hotel business.

While Marriott’s Moxy and CitizenM have taken bold steps towards a new kind of social, budget-conscious hotel, Accor has taken the idea a little further with Jo&Joe.

Jo&Joe, announced in September 2016, is a new accommodation concept that places design, food, and user experience as its top priorities. Sebastien Bazin, Chairman and CEO of AccorHotels, said that the goal was to “break from tradition, forget the old habits, surprise, be authentic, unexpected,” and bring a breath of fresh air to AccorHotels. The chain hopes 50 properties will open in urban areas around the world by 2020.

Jo&Joe targets Millennials. However, as Craggs points out, the concept could appeal to a wider audience. The poshtel, despite its smaller overall sleeping area, offers flexibility in room types, which could appeal to older guests as well as families and groups who would normally book more traditional hotel accommodations.

Poshtels are a great way to experience the kind of travel that AirBnB offers. They also provide a consistent level of quality and a different experience than the sharing economy. Craggs says that these new hostels offer a unique experience. They offer value and an unforgettable experience you can’t find in a residential unit.

High business potential

Poshtels have a variety of benefits for hoteliers and developers. Craggs says that this type of property has a higher profit margin because it is cheaper to operate and build. They may also be located in buildings or locations that aren’t suitable for hotels.

Modern travelers are attracted to vibrant communal spaces, unique experiences, and affordable rates. The concept is appealing to a wide range of guests, says Craggs. “And, from a development standpoint, the metrics are sound.”

Poshtels continue to grow in popularity as a place for the money-conscious traveler and the profit-conscious hotelier.

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