Mitchell Hochberg, the president of Lightstone, is putting his company’s stamp on New York, with a host of developments that reach into multiple real-estate classes. With four Moxy hotels open or under development in the city, the developer is now on the prowl for further growth. We talked to him about what that expansion looks like and how the limited-service model has changed.
1. You have opened or are developing four Moxy hotels in New York. What overriding value do you see in the brand? Why is it distinctive versus other brands in the limited-service space?
We recognized that there was an opportunity in the market for affordable hotels in New York City. Visitors had unappealing options: traditional select-service hotels that are cookie cutter and home-sharing platforms, like Airbnb, where security, cleanliness and convenience are promised, but not guaranteed. Today’s guests desire high-level design and diverse food-and-beverage experiences.
The introduction of the 612-room Moxy Times Square represented a disruptive shift in the environment. We know that in New York guests often pick hotels by neighborhood, which is why we put a tremendous amount of thought into crafting each Moxy specific for its location while keeping with the Moxy brand. [Other Moxy properties being developed by Lightstone are in Chelsea (opening in fall), the East Village and Lower East Side.] We worked closely with Marriott [International] to define our approach. The design and experience at each Moxy hotel is inspired by the surrounding community, without losing the soul of the Moxy brand—a boutique, technologically savvy and affordable lifestyle hotel. We also plan to develop additional Moxy properties in South Beach, Miami, as well as downtown Los Angeles and West Hollywood.
2. How is the select- or limited-service model changing? It’s come a far way, particularly from a design perspective. What will be the new normal for this segment in five years?
Today’s travelers have a self-service mentality: Give them what they need and they can handle the rest. We recognized this when developing the Moxy brand and stripped out some of the gratuitous amenities found at traditional luxury hotels—the bellman, roomservice, the newspaper at your door—so we could make it more affordable. At Moxy Times Square, rather than a typical lobby with a large front desk, guests check in at a kiosk in the arrival area. We’ve also replaced the traditional roomservice model with The Pickup, a twist on the traditional grab-and-go concept. Bar Moxy is the social heart of the hotel, providing guests and locals a co-working space during the day while transforming into a buzzing lounge when the sun goes down.
We recognized this evolution in the ethos of the modern traveler and feel we cracked the code on how to deliver affordability without sacrificing style or comfort. We see Moxy as the industry’s answer, or antidote, to Airbnb because the room rates are under $200 a night and offer the safety, amenities and ideal location (and of course rewards points) that you can only get from a hotel.
We’re seeing a new generation of fun-hunting travelers who value experiences and community over material possessions and attitude over opulence; travelers who crave an authentic environment and the ability to personalize it; those who reject design for design’s sake, but revere design that enhances functionality and creates memorable moments; those who want a hotel to be a fun and coherent experience, not a sequence of formalized rituals. With Moxy, we’re giving guests an overall experience that they enjoy, focusing on the elements of the guest experience that matter most.
3. Lightstone is not pegged to only one development space, having your hands in hospitality, residential and other commercial offerings. How do you evaluate potential projects?
As cities continue to expand and evolve, we think it’s increasingly important to pursue projects in high-value, unexpected areas. We’re also investing in growing, transit-accessible neighborhoods that are in the process of becoming destinations all on their own. For example, outside of the hotel market, we recently opened Arc, a luxury rental property in Long Island City, in Queens. We also recently acquired the Hilton Garden Inn in the area because we’re approaching the neighborhood from all angles, not just through a single lens of hospitality or multifamily. Whether it’s a Moxy hotel or one of our multifamily rental or condo projects, we’re focused on opportunities that offer world-class design, the best locations and stand-out amenities, with the goal of exceeding expectations of what a property can offer.
4. What do you foresee as your biggest challenges and biggest opportunities in the hotel space?
There are a lot of opportunities to be successful in today’s hotel market. Right now, we see high potential in the select-service/lifestyle-oriented niche because it offers a very compelling and in some ways more modern experience that today’s guests seek. We also think in the select-service space, especially in urban environments, we can compete and win not just against full-service hotels, but against Airbnb and other new and disruptive industry players. However, we’re also sensitive to some of the challenges the industry faces, including overbuilding and proliferation of new brands. Developers want to partner with brands that are easy to understand and deliver a unique experience. We searched long and hard for a brand that would work for our latest development projects, and we’ve found that with Marriott and Moxy.