Hostels v Hotels – a Legal Viewpoint

Main Photo:  A London hostel, where rooms range from private rooms for two to dormitory style with 8 or even 12 beds

Date: February 2019

Location: UK

Who:

  

What Did They Say: 

“Hotel: An establishment providing accommodation, meals, and other services for travellers and tourists.
Hostel: An establishment which provides inexpensive food and lodging for a specific group of people, such as students, workers, or travellers.”

Even the briefest of comparisons of the dictionary definitions of these words highlights the marginal differences between them.

Content: This reflects reality as, for many travellers, either a budget hotel or a high-end hostel may be viable accommodation options. From a commercial perspective, one use may suit the property, area, or clientele better. However, property owners should be wary of the legal impact of this interchangeability.

Under the Town and Country Planning (Use Classes) Order 1987, hotels fall within Use Class C1. Hostels, however, are specifically excluded in Article 3(6)(i) and are therefore sui generis.

On the face of it, this means that moving from hotel to hostel use (or vice versa) requires planning permission.

In Badia v City of Westminster Council [2013] P.A.D. 18, the Planning Inspectorate outlined the elements which might discern a hostel from a hotel:

• the presence of dormitories or shared facilities;
• the specification of accommodating certain groups of people;
• the lack of services provided;
• residents that are not transient (they are placed in the accommodation whilst awaiting accommodation elsewhere);
• the display of notices indicating use; and
• booking on a bed-by-bed (as opposed to room-by-room) basis.

It is easy to see how an up-market hostel, targeting travellers for short term stays, might stray into hotel use.

Some high-end hostels allow groups (or even couples and individuals) to book entire rooms and provide hotel-like services such as housekeeping, restaurants and bars.

It follows that early legal input into any intended changes to a hotelier’s business composition, business plan or target market could avoid unintended and potentially costly consequences.

Conclusion: Not all hostels are created equal, and many are a world away from hotels, but in the window of opportunity where the two overlap, property owners should beware that their eye for business doesn’t lead them into a trap.

Who are They: Russell Cooke are a top 100 London-based law firm with around 200 highly regarded specialist solicitors and lawyers. They advise a mix of commercial, not-for-profit, regulatory and personal clients.

 THPT Comment: This is the first of a few articles on UK law and how it might affect hoteliers…would welcome similar pieces on this subject from other European and non-European countries…

For further info contact Russell Cooke via email: Peter.Nicholson@russell-cooke.co.uk

The Hotel Property Team (THPT) is a small group of highly experienced business professionals. Between us, we provide a range of skills and experience which is directly relevant to those involved in the hotel property market.

For more information – Visit www.thpt.co.uk or email info@thpt.co.uk.