Simon Calder: The Man Who Pays His Way

No room at the inn, or the hostel, or the hotel...

Berlin Zoo says the timetable, and it's correct: literally, because the Zoologische Garten is right outside the station; and figuratively, because every species of traveller is here. Businessmen and women wait for sleek expresses to Frankfurt, gastarbeiters gather their belongings for the long journey home to visit family, and weekenders anxiously scan the boards for the next train to Schönefeld airport. By far the most common species, though, is the backpacker.

Berlin Zoo says the timetable, and it's correct: literally, because the Zoologische Garten is right outside the station; and figuratively, because every species of traveller is here. Businessmen and women wait for sleek expresses to Frankfurt, gastarbeiters gather their belongings for the long journey home to visit family, and weekenders anxiously scan the boards for the next train to Schönefeld airport. By far the most common species, though, is the backpacker.

Since the Wall came down 15 years ago this week, the German capital has overtaken Amsterdam as the European hub of the low-budget traveller. Those who may have herbally over-indulged in the Dutch capital may be confused by a poster at Alexanderplatz, the next station after Berlin Zoo, that inexplicably announces the location to be Amsterdam Centraal. This feeling of dislocation continues when you step from the train to face multiple offers of a bed for the night. "Good in beds", promises one billboard; "Tired?", asks a second: "Only 30 metres".

A back-of-the-guidebook calculation suggests there are around 2,000 beds for backpackers in central Berlin. But the evening I arrived, without a reservation for any of them, even this number seemed insufficient. A receptionist in one of the hostels I tried explained that there was a festival in town, and added helpfully: "It's a competition for doing what Robin Hood does."

Hmm. I imagined the chaos on the streets as thousands of people robbed from the rich and gave to the poor, and concluded the event must be some kind of throwback to the communist era, until I realised the gesture she was performing was of drawing back a bow to fire an arrow. The competition in question, I found out later, was more elaborate than a simple archery contest. The European RunArchery cup combines arrows with sprints.

If the organisers ever decide to turn the tournament into a triathlon, the third event should be the backpacker trudge. Staged on Saturday evening when everyone else is having a wonderful time, it involves plodding around from one hostel to the next, being politely told to look elsewhere. The loser is the one who ends up back at Zoo station for the night trying to dodge the security guards.

One receptionist made rejection bearable by suggesting a trip out east. From his description, The Generator (a hostel, not an electricity supply facility) seemed almost as far away as Poland, but it was late and I was desperate. Fifteen minutes on a tram took me to a huge East German office block of the type that are scattered across the former Democratic Republic. Unlike most such blocks, though, this was lit in an eerie electric blue. And unlike other hostels, it had a bed. The location was in Dorm 213, beneath Robin Hood, or rather an archer named Jürgen, who occupied the bunk above me.

Backpackers have replaced bureaucrats at The Generator, and the box-like bureaux have been converted into high-density sleeping quarters. The Generator holds the same number of people as two full Jumbo jets. The public areas are vast, and comprise a space-age mélange of bare metal, blue paint and blinking screens. Some screens carry music television; others have people crouched over them, no doubt e-mailing their pals in other hostels.

In the olden days, every night was party night in East Berlin: the Communist Party ruled every aspect of life. These days, the party lasts all night, at least at The Generator. Happy Hour begins at 5pm, with beers at €1 each until 9pm. The bar stays open until everyone has left, which - in the case of the British lads I met the next morning - meant 8am. This was when the taxi arrived to take them to the airport.

Even though their beds remained untouched, they had not wasted much cash: in a Robin Hood-like transfer of wealth from the old East German state to impecunious backpackers, a night at The Generator costs just €15, barely £10. The price, which is €70 (£50) lower than that of the Park Plaza hotel next door, buys you a bed, linen (a real plus in a hostel) and breakfast. This includes all the food you can eat, or in the case of my compatriots, throw at each other.

There is no need to go all the way to Berlin to experience The Generator - you can instead sleep with seven strangers in central London, close to Russell Square. I have a home of my own in the capital, but did call in at The Generator for Happy Hour, which lasts from 6 to 9pm and promises drinks for £1. The atmosphere reminded me of a zoo. "Ideal for 18-35s," stresses the publicity. "Friendly staff, great atmosphere, hangover included." I bet you can hardly wait.

Generator Berlin: 00 49 30 417 2400

Generator London: 020-7388 7666

www.generatorhostels.com