In recent decades, burgeoning prison populations, high rates of recidivism, and dysfunctional prisontowns signal a crisis in today's carceral institutions. While the extant literature describes failures of government programs and flaws in confinement philosophies, it does not fully explore the extent to which architecture fosters this crisis. Despite being the pre-eminent model of prison architecture, the panopticon has grown increasingly obsolete as variations of it proliferate in the 21st century. The Halfway Hotel draws on the contributions of these variations and is presented as a new model for a carceral facility that better accommodates a specific segment of the criminal population (non-violent criminal transients) that is not well served by existing prisons. A distributed network of carceral capsules that are integrated into the urban fabric, the Halfway Hotel avoids the stigma associated with typical prisons and builds a more constructive relationship with the city it is situated in.