Starting a hostel cheaply

Starting a hostel is something I have been interested in for a while. While it would be nice to design and build a hostel from scratch, this requires a large capital.

In this post I will describe 3 hostels which have been setup with a reasonable budget. These are hostels I have enjoyed, are successful, are in cities, and I find inspirational. They are in Beirut, Seoul and Cairo.

Note: Photos in this post come from the websites of the hostels.

1) Hostel Beirut, Lebanon

This hostel was setup by a Danish guy who was a musician. He had rented the top 3 floors of a residential building. It was in the Geitawi neighbourhood, which is predominantly Christian and located just above Mar Mikhael that has a number of cool bars and restaurants.

The building needed little internal work. The main floor was a flat with a large communal room and terrace, which is very important as people who stay in a hostel are there to socialise with other travellers. All the furniture was second-hand and in poor condition — however, this is acceptable as generally this is not a priority for people staying in a hostel.

There were 3 dorms and 3 private rooms, with a total capacity of 22. The only structural change needed was the addition of 4 communal shower cubicles and 3 lavatories on the top floor.

Hostel Beirut 1

When it opened in Jan 2014, the first month there were no customers, but when I was there in September, it was full every day. Customers mainly were Westerners: university exchange students, NGO workers, journalists, travellers.

The unbelievable thing was in Beirut there were only 2 hostels at the time of my visit. And as the city was not cheap, the dorm beds were $20 per night. So the income from this place was also good in global standards.

Plus, they sold beer cheaply, which was another source of income. They provided free breakfast, coffee and tea.

Hostel Beirut 2


2) KpopStay, Seoul, South Korea

This hostel was setup by a young Korean in Hongdae, the university neighbourhood of Seoul. So again there were plenty of cafes, restaurants and cool people around.

It was in a villa with a garden that had been rented for 3 years. There seemed to be quite a bit of internal work done, mainly with the communal bathrooms. The theme of the decor was K-pop and furniture was new and stylish. It had 5 dorms, with a total capacity of 44, and also one private room.

KpopStay 1

The main communal area was the reception and had bar style seating. The communal area upstairs was not utilised much, as everyone prefered being downstairs.

It was employing receptionists in exchange for free stay — they didn’t receive a salary. Per night it was around $30 — not cheap for a hostel!

I stayed there in Dec 2013.

KpopStay 2


3) Dina’s Hostel, Cairo, Egypt

This was setup by an Egyptian lady and her friends on the top floor of a characterful 19th century downtown building. The building had an old style lift and high ceilings. Initially she had half of the top floor and then, as business had grown, had taken over the other half. The rest of the building seemed to be offices. It had a good layout and decent-sized rooms. Again probably the bathroom was the only place where structural work was required.

It had dorms, but most of the rooms were private. The furniture seemed to be second-hand, though the private rooms had attractive furnishing. The cool communal area mainly had floor seating with cushions. They also had movie nights. When I was there a documentary by an Egyptian filmmaker was shown. Some of the employees were immigrants from Sudan.

Dinas Hostel 1

Per night it was $8. This meant income from this place was probably not good in global standards i.e. travelling to the UK or Japan would be difficult to afford.

As there is a large number of hostels in downtown Cairo, there is a lot of competition. But then, when it is peaceful, Egypt attracts a lot of travellers. Customers at Dina’s were mainly travellers and a few language students.

I stayed there in Mar 2013.

Dinas Hostel 2


Basic points to take:

  • Rent a building that needs little internal structural work
  • Location is very important
  • Good communal sitting area and a kitchen
  • Second-hand furniture is fine
  • Good number of showers and lavatories so people don’t have to wait

To add to these, ideally it would be good to have a partner. If you are interested in hostels too, it would be nice to hear your thoughts!


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