Scots pod hostel pioneer takes on Europe

Code Pod Hostel opened its initial site off Rose Street in Edinburgh three years ago. Photograph: Ian Georgeson
Code Pod Hostel opened its initial site off Rose Street in Edinburgh three years ago. Photograph: Ian Georgeson
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An Edinburgh-based business behind a revolutionary pod hostel has secured funding to replicate its success in key tourist hot-spots across Europe.

Code Pod Hostel opened its initial site off Rose Street in the Scottish capital three years ago and recently acquired an existing hostel operation in Dublin which is about to undergo a conversion to the full pod concept.

The firm is tapping into a trend towards boutique pod-style accommodation in Europe, mirroring its success in Asia, where the hostels help meet the demand for low-cost overnight stays in high-density urban areas.

Code’s founder and chief executive, Andrew Landsburgh, said the first pods were due to be installed in the Dublin site to trial during next month’s Saint Patrick’s Day celebrations in the city. A full refurbishment is earmarked for later in the year.

The firm has partnered with private equity heavyweight Patron Capital to develop the Irish hostel, which offers around 400 beds, and Code is now eyeing several locations in the UK and mainland Europe in order to scale the business up.

Landsburgh said London, Amsterdam, Paris, Madrid, Lisbon and Warsaw were among the major destinations on the company’s radar. A second Edinburgh site in the city’s Old Town to complement the Rose Street operation is also on the cards.

“We are looking at sites across mainland Europe just now,” said Landsburgh, who stressed that the company’s headquarters would remain in Edinburgh.

“We have a great team of people here that we are going to grow quite rapidly,” he added. “We have been working with a local brand agency, software developers, designers and architects, and we want to take local suppliers on the journey with us. There are a lot of hybrid hostel brands coming out of Europe but not the UK.”

The Dublin deal represented an investment of €14.5 million (£13m) and Landsburgh described a hostel offering between 200 and 400 beds as the “sweet spot” for the business.

The firm’s headcount in Edinburgh numbers 15 with about 30 in Dublin. Staffing levels at the capital HQ could rise as high as 50 as the company scales up.

Landsburgh, who previously built up a serviced apartment company and a student accommodation business in Edinburgh and Dublin, said the pod hostel in the capital’s New Town was proving to be a “great success” after a slow initial take-up.

“It has now been operating for three years, and at first it was a bit of a slog,” he said. “We are now getting tons of repeat business.

“There are a huge amount of Asian visitors who understand it and like it. We are offering a quality sleep in a high density, affordable way.”