We stayed here for our one night in Xian. The weather was a bit grey and drizzly when we were there, and this hostel was a really cosy place to come back to after our expedition to the Warriors...
We arrived in Xian around 8am on the overnight train from Beijing (we had a 2 berth cabin with own bathroom, really recommend that as was nice and cosy and we both actually slept pretty well...) Anyway we booked this place as we figured it was near the station so we could leave our bags before going to explore Xian / see Terracotta Warriors etc... we walked to the hostel in about 15 mins.
We were given a little green tea while we checked in, and our room was already ready so we got to check straight in and have showers which was brilliant and much more than we'd been expecting. There was a bit of a smell of drains in the bathroom (we noticed this in a few places around China) but the place was really clean, and amazing quality for the price. The hostel is set through a series of courtyards, separated by ornate, round stone arches. It's really quite atmospheric and feels quite historic, and it also has a great lounge / cafe / restaurant place where we spent quite a bit of time. It was really cheap in there, decent coffee, good wifi access, they played films (in English with subtitles) from about 5pm and good background music the rest of the time, nice decor and all quite indie, staffed by lots of young, friendly people.
For anyone staying there, as you're probably going to see the Warriors, I'd recommend doing it yourself - we thought we might have to get some sort of tour but actually we just walked back up to the station and was fairly easy to get a local bus to the warriors. We don't speak the language but pointed at the terracotta warriors in the guide book and the bus drivers pointed us in the right direction; we did the same with the bus conductor - they still have them on all the buses in China! - and she told us where to get off. It looked a bit like the middle of nowhere but she pointed for us to cross over, and once we walked over the road and in a bit the whole complex was there, easy to buy tickets, get a guide there if you want one (we used the audio guide which was pretty good).
The journey back to the bus station was similar - just head to where all the buses are in the a car park at the complex - I think pretty much all the buses are going back to Xian anyway, but you can point at writing of 'Xian' in Chinese in your guide book to double-check with driver / conductor. If you're keen to go see the Warriors under your own steam like this, I'd particularly recommend staying at this place as it's walking distance from the railway station from where all the buses depart and arrive.
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