The new Freehand Chicago represents the most updated incarnation of the hybrid hotel/hostel segment, which has been popular in Europe for years, combining both regular hotel rooms and shared hostel rooms.

The first Freehand in Miami opened in 2012 just one block back from the gauntlet of glamorous South Beach resorts with equally glamorous prices. Shared rooms start under $50 per head, while the 33 single rooms run anywhere from 25-60% below the cost of the lowest priced beachfront resorts depending on the season.

The surprising thing in Miami is that guests booking the single rooms are often people who can afford the big name resorts, but they want the low-watt local charm that Freehand cultivates so well. Part of that is due to the James Beard-nominated Broken Shaker bar with a colonial outpost ambience, the peace and quiet, the palm tree-shaded pool in the backyard, the international clientele speaking a dozen different languages, etc., etc.

It will be interesting to see if the same booking trend happens at Freehand Chicago, which opened last month.

“Freehand is really a full-on lifestyle hotel with the heart of a hostel because it’s communal and friendly,” says Andrew Zobler, founder of the Sydell Group, who also developed Ace Hotel New York and neighboring NoMad Hotel. “It’s more social and interactive by nature, with a kind of nomad spirit, but we have first class cocktails as good as you can get anywhere.”

He adds that because of the hostel rooms, the average age will always skew young and the average rate “will be affordable.” For now. Advertised single room rates for July on the Freehand Chicago site start around $160 but shoot up to $200-$250 on weekends.

“We’ve upped our game a bit for Chicago, which is more of a hotel with hostel rooms,” Zobler explains. “Miami is the reverse of that.”

Located two blocks from North Michigan Ave and four blocks from the river inside the old Tokyo Hotel building, Freehand Chicago has 135 single rooms and 80 multibed rooms. Because of the neighborhood, the property caters to a larger percentage of business travelers than Miami during the week, who want the low prices and don’t mind the smallish rooms.

Zobler says the value is there in terms of the vibe, food and beverage, location, and design quality, which is more urbane compared to South Beach’s nautical narrative, and “our bathrooms are as nice as anywhere.” The rooms come with small desks, televisions and standard hotel guest room amenities. The beds in the hostel rooms also have a nifty workspace with a dropdown desk tray for devices.

Sydell again worked with NY-based design firm Roman and Williams, who also conceptualized Freehand Miami.

It’s easy to get excited about Freehand based on price alone, which has always made Miami such a great find for those who know about the single rooms. But don’t get too excited. Freehand, as much as many of us may wish, is not the answer to skyrocketing hotel rates in popular urban centers.

Zobler says due to the popularity of the single rooms and the complete lack of supply in the hybrid hotel/hostel segment, he expects Freehand Chicago’s single room rates to surpass select service hotel pricing in the surrounding area once the property gets its legs under it.

Social is Super Important

Few hospitality groups do social as well as Freehand. In fact, one that is comparable is the Generator Hostel group in Europe, which we covered a couple years ago. We asked Zobler how important he thinks the Freehand blog and social media are as business drivers.

“We think it’s the number one source of business referrals because people are getting their info and finding out about us on Instagram and the rest of the social media platforms,” he says. “So it’s super important because our demographic relies upon recommendations from websites that have credibility. We learned a long time ago that quality content is important to build a loyal customer base.”

Zobler says the property has one employee who’s sole responsibility is content development and blogging about events at both the property and around the local community. In Miami, a lot of people rely on the Freehand blog announcements about cool things to do in the city more than the local entertainment weeklies.

The next Freehand under development is located in Los Angeles’ Commercial Exchange building in the booming downtown core. Another 320-room Freehand is going to open in New York also (NoMad District, maybe?), but Zobler hasn’t signed the deal yet so he won’t say where, and then there’s talk about possibly moving into London (Shoreditch, probably).

Greg Oates covers tourism and hospitality development.

Photo Credit: The hipster-meets-hostel lobby bar and game night scene at Freehand Chicago. Freehand