Bucharest hostels, which provide cheap, youth-orientedaccommodation, operate with profit margins of 25% even in times ofcrisis, with hotel demand falling dramatically against last year,and revenues of hotel operators down by over 30% in the first halfof the year.
A hostel tends to charge half as much as a two-star Bucharesthotel, with the occupancy degree exceeding 60% in the first sixmonths of the year, and 90% of clients being foreigners.
"We have invested 100,000 euros of our own money in boosting theaccommodation capacity of the hostel. It was closed for fivemonths, but this summer we started to receive tourists again. Wehad only 60% occupancy rate during the summer months, probablybecause of the lack of promotion during the time when works wereunder way," said Ovidiu Pungan, owner of the Alex Villa hostel inBucharest.
The hostel owner says the lower demand for accommodation onBucharest's hospitality market has prompted some of the two-starhotels located on the outskirts of Bucharest to cut fees to matchthose charged by hostels, but that this does not affect hostels'activity much, since they are mainly sought after by youngpeople.
Almost 80% of tourists lodged at Alex Villa were foreigners, Frenchtourists mainly, who spent one to five nights there.
Last year the operator collected almost 16,000 euros from thehostel business, of which 4,900 euros in accounted for by the grossprofit, according to data from the Ministry of Finance.
Veronica Dragoiu, owner of Friends Hostel Bucharest, which has roomfor 22, says that while the hostel did not accommodate a very largenumber of tourists between September last year and February thisyear, the hostel "returned to normal" in March.
"Things have not changed very much from last year in terms of thetourists we attract - 90% of our clients are young foreigntourists, and the costs per person range between 10 and 14 eurosper night," Dragoiu said.
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