Are capsule hotels the future of budget travel in North America?

Canada's Panda Pod Hotel might be cool enough to ignite a trend

Photo courtesy of the Panda Pod Hotel

Capsule or pod hotels have long been a popular budget option in Japan and other parts of the world, but they’ve been slow to catch on in North America. But now a new pod hotel in Vancouver, Canada is betting big on travelers falling in love with their hip and comfortable accommodations. The Panda Pod Hotel might just be cool enough to finally bridge the culture gap and make capsule-style hotels mainstream in the United States and Canada.

If you’re new to the idea, staying in a sleek little capsule for the night might sound like something out of a futuristic sci-fi movie—but the pod hotel concept has been around for a few decades. The first pod hotel opened in 1979 in Osaka, Japan. At the time, the concept offered Japanese salarymen who had been out drinking and missed the last train home an affordable place to spend the night. It also demonstrated Japanese principles of efficiency by maximizing occupancy on a given plot of land.

Panda Pod's rooms come with a side table and charging station
Panda Pod’s rooms come with a side table and charging station. | Photo courtesy of the Panda Pod Hotel

Over the next few decades, the capsule hotel gained popularity in Japan as well as in other countries in Asia and Europe.

Meanwhile in North America, with a few exceptions, the concept never fully took off. The abundance of budget hotels across the continent made the margins and value propositions for a pod-style hotel seem less attractive than in other parts of the world.

Big cities in the U.S. and Canada, however, are seeing increases in both tourism and business traveler numbers, and the limited availability of quality lodging at affordable rates is becoming an issue. With this need for more rooms at reasonable prices, the owners of the Panda Pod Hotel saw the timing finally right for a pod-style entry into the Vancouver hotel market.

An international travel boom

Vancouver is experiencing an influx in travelers from Asia, many already familiar and comfortable with the pod concept. As the number of passengers at Vancouver International Airport set a record with 24 million in 2017, Panda Pod Hotel made plans to tap into that market.

“We can see the growing needs in accommodations for worldwide travelers,” says Sharon Cheung, general manager of the Panda Pod Hotel. “Throughout the past 10 years, the hotel daily average rates and occupancy rates have been on the rise. We would like to offer a more economical accommodation alternative for travelers with budget concerns.”

The idea of staying in a tiny pod for the night might still be a hard sell for many North American travelers, but Panda Pod has gone to great lengths to make their hotel more American- and Canadian-friendly.

"Sleep like a panda" at this new Vancouver capsule hotel
“Sleep like a panda” at this new Vancouver capsule hotel. | Photo courtesy of the Panda Pod Hotel

The biggest difference between Asian pod hotels and the Panda Pod is the size of the pods. The Panda Pod Hotel’s 64 pods are 30 percent longer and wider than their traditional Asian counterparts, so guests will enjoy plenty of legroom. Each pod also features a high-end mattress, a folding table, and a charging station, plus complimentary storage lockers for valuables and carry-on bags.

Building community

The Panda Pod Hotel’s rooms may be comfortable, but that’s not the only reason pod-style lodging could eventually win a sizable chunk of the North American lodging market. It’s also the community they create.

The Panda Pod, for example, offers a hip lounge for visitors to unwind and meet fellow travelers. It’s like the best parts of that hostel backpacking trip you took through Europe in your early 20s, but without the downsides of sleeping in a room full of strangers.

According to Credence Research, the pod hotel market is only getting hotter in North America, with a value of nearly $167.07 million in 2017 and an expected growth of 6.3% between now and 2026.

For non-claustrophobic travelers fascinated by this growing trend, there are plenty of places to give it a try—including some stellar pod-style hotels in the United States. For example, the chic Pod Hotels in New York City and Washington, D.C. are perfect for giving this style lodging a try.