Arriving at night in a hotel near a main Train Station can be trying but the staff at reception was really friendly.
Small rooms that do look like dorm rooms, but they are very functional and more importantly, spotless. The beds are comfortable.
The location is very good, especially considering the price! It's a 3min walk to the station (from there you can take the S Bahn or the U Bahn to nearly anywhere in the city), and less than 10 to several museums, main shopping area and Alster.
Overall, the service made a real difference, and the value for money is good.

The good: In a charming older building, and conveniently located near one of Hamburg's main train stations and also near an interesting street full of international restaurants and markets. Reasonably clean, and includes a small breakfast.
The bad: The furniture was what one might expect to see in someone's dorm room-- very basic, with seemingly no attempt to make the place visually appealing. No alarm clock. Our bathroom also had a very institutional look, and was very cramped. It seemed designed so that one could brush one's teeth at the sink while seated on the toilet. Parts of the building had a nice, older look, but the whole looked very tired and was in need of renovation. The reception spoke some English, but was quite brusque and unfriendly. Overall, we felt this was an OK place to stay for 2 nights, but seemed overpriced for what we received.