Inside wild $250k/year ‘capsule' hotel

News.com.au

4 days ago

A Gold Coast hostel charging $300 a week for 'capsule' beds is delivering $250,000 a year in rent to its owner, as women priced out of the brutal housing market bunk alongside backpackers.
Modelled on the Japanese pod concept, Capsuleaccom's Southport facility features stacked rows of 134 single beds, separated by bunk dividers and curtains.
Opened in 2024, the business targets backpackers and international students, charging $48 a night or $300 a week.
But with rental affordability worsening, the property has also housed vulnerable locals on longer-term stays, some contributing volunteer hours in exchange for a bed.
Owner Ian Robinson said the business offered transitional accommodation for new arrivals, most on a student or working holiday visa and without local ties.
'We aim to bridge that gap by offering welcoming short-to-medium term housing as they transition into life here,' owner Ian Robinson said.
While not designed for crisis housing, Mr Robinson said the hostel was open to supporting homeless people 'when feasible'. But integrating those guests with international travellers had proved challenging.
'While some situations have worked well, with a positive sense of purpose and mutual respect among guests, this is not always the case.
'Our focus remains on creating a safe, structured environment for those transitioning into Australian life, and managing the mix of demographics requires careful consideration,' he said.
Charity worker Karl Westwell, of Agape Outreach, said two homeless women aged in their 40s and 50s were forced to leave ahead of the Gold Coast Marathon in July.
'It's clean and comfortable, but crowded, cramped and certainly not cut-rate at $350 a week – that's what one of our clients tells us she now pays for a capsule,' Mr Westwell said.
'That gets you a single bed under a ceiling you can reach without sitting up, and a curtain for
a door. No privacy, no security, no dignity.'
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Capsuleaccom manager Shanice Attryde said rates were higher during peak times like the marathon, when bookings filled up to 12 months in advance.
'Some guests were unable to extend their stays immediately due to prior bookings,' she said, adding they were offered a full week's extension at the standard rate.
Mr Westwell said the charity couldn't find accommodation for the two women, instead providing them with a tent and sleeping bags.
'There is nothing else available,' he said.
'People in crisis are being shuffled like playing cards from this and other accommodation.'
He said one of the women had become homeless after a landlord increased the rent at her last permanent address by $180 in two years.
Cotality's latest Quarterly Rental Review shows rents increased by 42.7 per cent nationally over the past five years, with Brisbane the country's third most expensive capital at $687 a week.
The 1105 sqm Nerang St property housing Capsuleaccom is listed for sale as a freehold tenanted investment with development upside. Records show IG Robinson Developments acquired the site in 2022 for $1.125m.
Marketed by Michael Willems and Matt Taylor from Ray White Commercial Gold Coast, the investment returned net annual rental income of $250,000 a year.
While a long-term lease was in place, the marketing campaign was currently under review, the agent said.
The listing described the building as a 'state-of-the-art capsule hostel' with modern shared kitchens, bathrooms, entertainment areas, and an on-site café.
Mr Robinson said providing services for the homeless community had been considered prior to the business opening.
'While the environment meets many of the needs of those experiencing homelessness — safety, community, warm beds, hot showers — we ultimately concluded that integrating our existing guest base with a broader homeless population on a larger scale would be difficult to manage effectively,' he said.