I booked myself into this place for my last night in Australia because I wanted a single room to myself, and this is one of the few that has 'em. Their Embassy hostel was nice, but Palace Central is closer to Central Station and has single rooms. It doesn't hurt that it's in a huge, heritage-listed Queenslander, which means the rooms have a great turn-of-the-century charm that just isn't present in the other huge, über-commercial hostels in Brissie. How many other places have one of those old-school cage elevators where you have to open the door and the cage yourself?? Of course, the oldness means that you have to put up with bathroom doors that don't lock properly and confusing hallways and stairs, but that's part of the old-school aesthetic, right?
That said, despite its charm, the Palace Central still is a huge, über-commercial hostel, but with a bigger deck, more crowded common areas, and a happy vibe, it's easier to meet folks here than at the other places.
The Central's main feature is the Down Under Bar, down in the basement, which is a draw for backpackers and students from all over BrisVegas. The DUB is simply crazy any night of the week, which is cool for a night or two, before the party-hearty backpacker bar scene gets old. How many times can you play drinking contests that end up with guys in their undies? Bleh. (Ok, I like the ones where the girls wind up in undies and can watch those every night...) The DUB is a monster of a meat market, but hey, that's what some people travel for. I found it a bit tacky compared to other places in Brisbane, but it was also cool to have an instant party option just downstairs.
Recommendation: The location is about as central as the name suggests, the building has quite a bit of charm, and the DUB below ensures a big night if you want one. On the other hand, it's really huge, rooms are tiny, and although it's among the more social of backpackers in Brisbane, you'll still have a hard time finding tons of friendly faces. If you need to spend a couple of nights in Brisbane, this isn't a bad place. I wouldn't tell you to avoid it, but I can't fully recommend it either.
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