NO longer just bare-bones bunks for backpackers, youth hostels in China are charming, distinctive and full of amenities, yet they're cheap. In the financial downturn, they're not only cool, but hot. Nancy Zhang reports.

Youth hostels emphasize cultural exchange, making friends and the human touch. But their traditionally not-for-profit nature in Europe and elsewhere means they are far from luxurious, often just on the right side of clean and functional.

This year marks the 10th anniversary of youth hostels in China, and the centenary of the concept worldwide. In China, hostels have come a long way from the hippie days of roughing it, though you can still do that if you want. They're quite trendy.

In China's developing market economy, youth hostels have had to reinvent themselves into profit-making businesses.

"However, we have tried very hard to maintain the spirit," says Yin Cheng, secretary-general of the International Youth Hostel Association in China. "It is the culture of youth hostels that has allowed the concept to endure for 100 years. It is similar to maintaining a brand. If we don't stay true to the brand, the business will fail anyway."

In maintaining their brand ?? low budget and warm culture ?? some hostels have developed into small, intimate and charming oases inside interesting buildings.

They are like boutique hotels for a low budget.

Naza Hostel in Hongkou District, which opened last month, demonstrates that cheap can also be beautiful.

The cheapest bunk bed is only 65 yuan (US$9.50), and a standard double room 189 yuan, but the hostel is rich in character and design.

The founders are four young designers and architects, all in their mid-20s to early 30s, who were inspired by their love of backpacking.

To relax from their stressful office jobs, the four sought out their favorite spot in Zhejiang Province. They constructed an impromptu backpacking shelter in an unused house, taking their water from a pure stream up the mountain.

It was there, one day in 2005, while eating sunflower seeds in a tranquil setting, that one of them suggested they quit their jobs and open and operate hostels full-time.

In 2006, they opened their first small 20-room hostel in a converted colonial mansion on Gulangyu Island off Xiamen, Fujian Province. The Gulangyu International Youth Hostel meets global standards.

In another two years, they were able to set their sights on a much larger project in Shanghai, Naza.

They had caught a wave of increasingly popular independent travel in China. Although the first youth hostel was established in Guangdong Province in 1999, for years hostels have been confined to the traditional backpacking hot spots in places such as Yunnan Province.

Since 2004, however, hostels have developed rapidly. There are 130 nationwide, and 20 hostels have opened so far this year.

Shanghai has nine international youth hostels, including two that opened this year.

To be officially categorized as a youth hostel, a business must belong to the International Youth Hostel Association and meet its standards.

Good example

The architecture of today's hostels is very much linked to their trendy culture. Unlike chain budget hotels, distinctive design transmits the identity of the hostel's location.

Naza in Hongkou District is a good example.

It's in a converted paint factory covering more than 2,000 square meters. Based loosely on the shikumen (stone-gated) architecture of old Shanghai, the hostel has 55 rooms, each with a different shape, character and atmosphere.

Some rooms are furnished with 1930s collectibles the designers found at markets. The lobby is punctuated by the stone arches typical of old Shanghai, while the restaurant features cozy bunk seating like that of northern China.

The design also represents the youthful freedom of the owners. The successful business team say they are more like "a student club" and the hostel business is more about creative expression than profit.

Each room is decorated with distinctive wall paintings ?? spaces are designated for guests to decorate. Thus far, most have been painted by the designers themselves and the interns in the reception staff, mostly university language students.

The paintings are warm and lively, not masterpieces. Guests are invited to decorate. One restaurant wall is filled with a smiling black cat painted by an American guest who got into the spirit.

"This place is about young people connecting with each other," says Hu Yang, a 25-year-old architecture graduate and the youngest member of the team. She describes blank "dialogue boxes" in rooms that invite guests to start conversations.

"The paintings don't have to be great; they can even be ugly," says Hu. "It's about keeping the feeling of someone having been here."

The emphasis on community stems from the original concept of the youth hostel. It was conceived by German school teacher Richard Shirrman in 1909 while on a school trip with his pupils. Caught in a thunderstorm, they took shelter in a local school.

As the storm raged through the night, Shirrman envisioned a network of cheap accommodation catering to students that would be self-sustaining as students would have to clean up after themselves and help out.

At Naza, there are now as many business people seeking low-cost accommodation as students, and independent travel is increasingly popular among young, hip, white collars.

Rooms are often rented out long-term; currently, a whole corridor is rented to a group of female airline attendants who are here for training. Rooms have TV, phone and wireless Internet.

In the economic downturn, Naza expects more business travelers as they downgrade from higher-priced hotels. Even so, hostels across Shanghai have lowered their prices recently.

International exchange is a big part of the culture, encouraging Chinese and foreigners to mix. In the economic downturn, however, not so many foreigners are expected, and the Chinese market is increasingly important.

While hostels in China have a business slant, they still have a far more personal atmosphere hard to find in budget chains or five-star hotels.

"We have used our artistic talents in the design, but it's not meant to be luxurious," says Hu.

"It's more about intimacy. Personally I do this to have a good time, to do what I want and live how I want. It's not measurable with money."

Other hostels

Three hostels in Shanghai operate under the Mingtown brand, but they say they are not a chain. Each hostel has its own character and design. There are another five Mingtown hostels in surrounding provinces.

The Mingtown Etour Hostel near People's Square is the most striking. Opened in spring 2006, it is a converted 1950s factory that made industrial dials and gauges. The design is loosely based on southern Chinese gardens but with a modern twist.

The cozy central courtyard features bridges over flowing water, a snooker table and a common room with a view of the water. Inspired by the surrounding old winding longtang (alleyway) and old people sitting in the sun, the hostel has walls of gray shikumen (stone-gated) brick punctuated by red Chinese lanterns.

The place encourages visitors to pass the time there, offering a sun lounge, Internet, cheap coffee and beer ?? hard to find in People's Square.

"We keep costs down to reduce the economic pressure on customers, only then will people relax and talk to each other," says Manager Jiang Xin, a backpacker who spent many years in Yunnan Province in the late 1990s.

"Many stories happen here, love stories between people of different countries, or people who come just for a visit, then make friends, decide to stay and change their life plans," Jiang says.

You never forget the hostel experiences of your youth, he says.

Opened in 2001, the Captain Hostel on Fuzhou Road is the oldest in Shanghai. At the time it was innovative in using a maritime design and theme to create atmosphere. A shipping theme echoes throughout the converted colonial building near the Bund ?? a tribute to Shanghai's fishing past.

There are another two Captain hostels in Pudong.

The grand four-story British building on Fuzhou Road has been turned into a ship's hull. Dorm beds are called "sailor bunks" and the dorms resemble the bunks of an ocean liner.

The top floor, the dining area, features an outdoor terrace with wooden floors like a ship's deck, with a view over the Huangpu River.

Inside, the bar is designed to resemble the insides of a wooden boat, with sails cover the ceiling.

The theme comes from the business of the owners, Shanghai Zhangjiang Boating Co, which runs tourist cruises on the Huangpu River. Many of the artifacts in the hostels come from the company's own vessels, and the hostels are an extension of their tourism business.

Over the years, newcomers to the hostel scene have learned the importance of design from Captain, but the hostel itself has become more commercialized.

Now roughly only half the space is dedicated to 100 hostel dorm beds; the other half consists of impersonal three-star hotel rooms.

"Youth hostels have made a great contribution to the increase of young, independent travelers in China," says Yin from China's international hostel association. "Ten years ago only older people had the means to travel and they usually did so in group tours."