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At the hotel.Hold onto your bedroll…hostels have gone upscale. Long associated with lone backpackers or groups of students clutching Let’s Go Europe, hostels are now attracting older adults, families and even business travelers, according to a recent New York Times article.

Josh Wyatt, a partner at Patron Capital, a private equity firm based in London that owns Generator Hostels, reports that traffic has been brisk among young business travelers at its hostel in Copenhagen and seven other European properties. At some, nearly 20 percent of the guests during the week are business travelers, especially in off-peak seasons. He attributes that to upgrades in service, accommodations, design and food and beverages—areas where hostels have not traditionally excelled, he told the Times.

Many Generator Hostel guests have fledgling careers and are traveling for work but lack generous expense accounts. Once they climb higher up the ladder, they might stay at stylish boutique hotels like W and the Standard, but for now they’re choosing upscale hostels over budget chains. The draw? “A great night sleep, a great shower and free Wi-Fi, all in a hip, relaxed setting,” says Wyatt. “If you have to travel and are on a budget, you still want to have fun and want something cool.”

A bed in a dorm room at Generator Hostel Copenhagen costs about 20 percent less than a typical midrange business hotel nearby. At Generator Hostel Barcelona, hostel accommodations will cost you 10 percent of that midrange hotel price. Generator hostels also offer private rooms at half the price of a comparable stay at a three-star hotel.

The hostel industry has grown in recent years because more people are traveling and because of the global economic downturn that pinched travelers’ budgets, according to Stay Wyse, a nonprofit trade association that tracks and researches accommodation trends among young travelers globally. Just as significantly, hostels are moving away from the traditional, “roughing it” concept to sophisticated high design with enhanced facilities and services.

An estimated 10 percent of hostel guests are business travelers, a figure that has grown about 1 percent each year since 2009, in part because “the product has significantly increased in quality,” Laura Daly, association manager for Stay Wyse, explained to the Times. “With the investment in facilities, we predict this will grow at a steeper rate year on year.”

Giovanna Gentile, senior public relations executive for HostelBookers.com, a London-based website for international budget accommodations, said in the article that many hostels now offered amenities traditionally associated with hotels—private rooms with bathrooms, swimming pools, conference rooms and gyms—as well as many amenities that hotels typically don’t provide, such as entertainment rooms with big-screen television sets, surround-sound cinemas, game rooms, pool tables and self-catering kitchens so that travelers can cook their own meals rather than spending a fortune in restaurants.

Add to that a new concept: the fusion hotel. The Fusion Hotel Prague, for example, is both a hotel and a hostel in one, offering standard private rooms as well as shared dorm rooms. The idea for a hybrid property was born after the economic crisis. “We have a product to sell to anyone, at anytime,” Nah-Dja Tien, Prague’s fusion hotel’s general manager, stated in the article. “We can give business travelers an alternative pricewise, and also an alternative experience.”

David Orr, founder of Hostelz.com, a hostel booking and review site, said: “The competitive market has driven up standards. They can’t get away with being grungy anymore. In some cities, hostels are nicer than hotels.”

So if you want to enjoy a drink at the bar at the end of the day without feeling awkward about being on your own, and you want to save a buck or two, try staying in a hostel!

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