A room at The Jane Hotel is photographed, Wednesday, March 18, 2009 in New York. The concept of an entire hotel room the size of a suburban bathroom has spread across Europe in recent years. And as the U.S. economy deteriorates, interest in the idea has grown, especially in high-priced markets like New York City �where there are fewer options for budget travelers.[Agencies]

NEW YORK �A New York hotel with luxury sheets and state-of-the-art audio for less than $100 a night? All you have to sacrifice is a bit of privacy and a little �well, a lot �of space.

Moving beyond budget accommodations to an idea that borrows from a ship's berth or a train's sleeper car, developers are gambling that in tough times travelers looking for a little pampering at lower prices will embrace micro-hotels.

The concept of an entire hotel room the size of a suburban bathroom has spread across Europe in recent years. And as the U.S. economy deteriorates, interest in the idea has grown, especially in high-priced markets like New York City �where there are fewer options for budget travelers.

"It's certainly the right product for the times," said Tom Botts, a specialist in the hotel and travel industry at Hudson Crossing, a strategic advisory firm.

The trick, says Sean MacPherson, co-developer of The Jane hotel, is to make its 150 tiny single rooms �about 7 feet wide by 8 feet long �feel "charming and special" rather than simply cramped.

With no room for extra furniture, guests at The Jane �which is opening in stages between now and the end of the summer �stash suitcases and clothing in storage spaces above and below the narrow bed. A large mirror and a small window help stave off potential claustrophobia.

The "micro-luxury" touches at what was originally, in 1908, a hotel that rented cabin-like rooms to sailors for just 25 cents a night include 350-thread count sheets, a 23-inch flat-screen LCD television, DVD player, iPod dock and free wireless Internet.

"If you stay at a hotel at any price, you have to have a sense of hospitality and luxury," MacPherson said. That's especially true in this economy, he added, when people are looking to get the most bang for their buck.

So, the bathroom? Alas, you'll likely have to share two public bathrooms on each floor, which each contain a pair of tiled shower stalls and toilets. The hotel also has 150 larger �and higher-priced �"captain's cabins" that include private bathrooms and offer a view of the Hudson River.

U.S. interest in the micro-hotel model has intensified as the economy weakens, said Bjorn Hanson, a hotel expert with New York University's Tisch Center for Hospitality, Tourism and Sports Management.

Expensive cities and airports are the prime locations for the concept. But Hanson said but some suburban locations near industrial or research centers might also work.

Botts was skeptical that micro-hotels would work in markets besides the very largest U.S. cities and questioned if the model will be worth the investment for the biggest hotel chains. "It might be a lot of work for not a lot of payback," he said.