Italy's first capsule hotel has opened its curtains in the country's economic capital, Milan.

Offering a cheap and cheerful alternative to regular hotels, the capsule hotel is also helping the city cope with the exploding number of tourists.

Each capsule measures a tight 4.2 cubic meters.

Eight capsules, four stacked on two rows, fit in the size of one standard hotel room, with an enclosed toilet space inside the room and showers down the corridor.

The capsules are already fitted with a mattress, a duvet and pillows. It also contains two charging plugs for mobile phones or laptops, a lockable cupboard for luggage and a bedside table.

All this would set travelers back 19 euros per night (21 dollars), including breakfast, with prices increasing up to 150 euros during Milan's world-famous Design Week.

For Spanish tourist Aline, it was the cost that enticed her. "The truth is this is the first time that I'm trying out such a concept and I like it very much. Everything is good, the prices, the rooms are nice, I have enjoyed my stay."

Croatian tourist Dragan Kupresanin, 31, booked his stay out of sheer curiosity. "It looked like something new, futuristic style, especially the rooms and those kind of boxes that you sleep in, more privacy that you get, that's why we picked this place," Kupresanin told AFP.

Privacy is one of the selling points of capsule hotel Ostelzzz, as similarly priced youth hostels don't often allow for privacy in the communal rooms filled with bunk beds.

Capsule hotels target younger travelers, with digital connectivity and a social side among their chief selling points.

"It's like a home, you have anything you want, the bathroom, the kitchen and what's more is that there are always people coming in and out so you are always meeting new people and you are not by yourself," hotel guest and Rome native Monica Vici told AFP.

Some 25 percent of guests are workers or students like 22-year-old Vici who lives at the Ostelzzz capsule hotel pending finding an apartment.

After or before her classes, she sits at her laptop in the sleek, stylized communal area, while, nearby, people come and go to the hotel's 24-hour bar.

But not all guests fall into the millennial category. The hotel had an 86-year-old guest, and boasts a family room with four inter-connected capsules.

Ostelzzz has proven a hit with travelers, and the company behind it, ZZZleepandGo, is setting its views further.

"We have a very high demand compared to the forecasts, which were already positive…the goal is to open hostels across Italy and Europe," company CEO Gianmaria Leto told AFP.

Capsule hotels will be open at six airports, including Milan and Warsaw, by year's end, with Vienna and four in Brazil to swiftly follow, making it the biggest such company in the world, added Leto.

With the ambitious expansion plan, the Italian company said it expects its annual turnover to grow to 10 million euros (11 million dollars) in five years, compared to one million in 2019.

Travel blogger Agnese Sabatini says the concept of capsule hotels is expanding. "While in Japan it was first created in train stations and airports here it is growing both in those places and within the cities," Sabatini told AFP.

The first capsule hotels were born in Osaka, Japan in 1979, said Sabatini. Since then, the concept has taken off around the world, first in airports, from Paris to Moscow and Bangkok, and then in cities like Singapore, Seoul or Mumbai.

Nevertheless, in Europe, capsule hotels are rare outside of airports.

There is for example the City Hub in Amsterdam and the Lucerne capsule hotel which opened in Switzerland at the end of 2018.

Milan is the first Italian city to have a capsule hotel, mainly to accommodate growing numbers of tourists.

The city went from 4.2 million visitors in 2011, to 6.8 million in 2018, of which 65 percent were foreigners.

Last September saw 700,000 visitors, up 18 percent year-on-year, many of them youngsters.