* Moxy chain to launch in Milan in early 2014
* Marriott wants 150 Moxy hotels within 10 years
* Rooms to be priced at 60-85 euros
* Competition for Holiday Inn, Motel One, Ibis
By Victoria Bryan
BERLIN, March 5 Marriott International
moved into the economy hotel market, teaming up with IKEA's
real estate arm to launch a new European chain for
travellers seeking style on a budget.
Cool and contemporary budget hotels such as Motel One, B&B
Hotels and CitizenM are springing up all over Europe to meet
demand from people who are keen to get away from it all despite
squeezed leisure budgets.
Marriott said that in Europe, the economy tier represented
nearly half of total room supply, but that there was still space
in the market, which also includes the likes of Ibis, Holiday
Inn and Premier Inn.
"You're talking about 2.5 million rooms in this segment and
we don't have anything yet," Marriott Chief Executive Arne
Sorenson told Reuters at the IHIF hotels fair in Berlin, where
the group installed one of the chain's 17 square metre rooms
with cream and brown furnishings and flat screen TVs.
The first Moxy hotel is expected to open in Milan in early
2014 and rooms will be priced at 60-85 euros.
Marriott said it was aiming for 150 of the hotels in Europe
over the next 10 years in countries from Britain to Germany, the
Netherlands and Sweden.
"That would be 25,000-30,000 rooms, so that's a small
segment of the market. It gives us hope at least that we could
be a number of multiples of that size over time," Sorenson said.
Inter Hospitality, a subsidiary of IKEA parent Inter IKEA,
will be the initial developer and owner of the first Moxy
hotels, while Nordic Hospitality will be the first franchisee to
operate the brand, Marriott said.
Rooms at Moxy hotels will all have USB ports next to wall
sockets and floor-to-ceiling wall art representing the local
city, such as the Brandenburg Gate for Berlin or bicycles by
canals for Amsterdam.
To keep costs under control, each room will be the same size
and feature the same decor, although not from IKEA, Sorenson
said, stressing that Inter Hospitality was separate from
Swedish-based group IKEA's retail arm.
Marriott's European head Amy McPherson said the plan was to
focus on Europe for now, with no plans at present to introduce
the chain farther afield.
Highlighting the importance of the economy sector to the big
hotel chains at the fair, Hilton announced plans for 10 new
mid-range hotels in Germany and Austria, and Intercontinental
Hotels said it had signed a deal to develop 15 new
Holiday Inn Express hotels in Russia by 2019, doubling its
Inter Hospitality, which has been keen to expand in the
budget hotels sector, said that it wants to secure 50 sites over
the next five years, mainly in Germany, Britain, Italy, the
Netherlands, Belgium and Austria.
"The great thing about Inter Hospitality is that they come
with a significant balance sheet so there is no financing
challenge," Sorenson said.
Like German rival Motel One, Moxy is hoping to attract a
mix of leisure and business travellers.
"Given the product we have, I believe the space is still
wide open. There's room for a number of good competitors,"