Sandakan sits on a peninsula on Sabah's east coast, facing Sandakan Bay and the Sulu Sea. It is the second largest city in Sabah and was the former capital of British North Borneo, and it remains a working port town rather than a resort destination. Most visitors come for the wildlife and the water: Sepilok Orang Utan Sanctuary, Turtle Islands National Park and Gomantong Caves are the anchors of a stay here.
For a visitor, the practical layout is simple. The town centre and the waterfront sit close together, with the central market and the bus station nearby, and the main road running north out of town toward Sepilok. Accommodation clusters in and around the town centre and along the harbour, with a few options further out along the main road. This guide covers which areas to base yourself in, what each suits, and how the price tiers differ.
Best areas to stay in Sandakan
1. Town centre
The town centre puts you within walking distance of the central market, the bus station and the banks, and it is where most of the city's accommodation is concentrated. You find budget lodges and small hotels here, including places on upper floors of shoplots and buildings behind the main commercial streets.
This suits first-time visitors and budget travellers who want to be close to transport and everyday services. It is the most convenient base if you plan to move around by bus or arrange tours, and several operators here double as travel agents. Expect some street noise in the busier blocks, and check whether your room is on an upper floor in a building without a lift.
2. Waterfront and Harbour Square
The waterfront esplanade and Harbour Square area face the harbour, opposite the central market. Accommodation here includes guesthouses and hotels with harbour views, ranging from backpacker dorms to more comfortable mid-range and upmarket rooms.
This suits travellers who want the water on their doorstep and a short walk to the market and town centre. It is a good fit for independent travellers and couples rather than families needing space. The trade-off is that the waterfront is a working harbour area, so expect activity rather than quiet.
3. North Road, toward Sepilok
North Road runs out of the city toward Sepilok, and accommodation along it sits between the bus station and the city centre. This is a small cluster rather than a full district, with guesthouse-style places offering dormitory and private rooms.
This suits budget travellers and those who want a quieter, more residential feel while staying within reach of town. You are on the road that leads toward the orang utan sanctuary, which makes it practical if Sepilok is your priority. You will rely on transport rather than walking for the town centre and the waterfront.
4. Bandar Kim Fung, Mile 4
Bandar Kim Fung sits at Mile 4, described as the middle of Sandakan, in a commercial area of shoplots. Accommodation here is in small hotels, and the surrounding blocks include restaurants, pharmacies and supermarkets.
This suits travellers with their own transport or those who prefer a local commercial neighbourhood over the tourist-facing waterfront. Having shops and eateries on the same block is the main convenience. It is not a walking base for the harbour or the town centre sights, so factor in transport.
Where to stay on a budget, mid-range or splurge
- Budget: dormitory beds and small private rooms in guesthouses and lodges, often in the town centre, along North Road or near the harbour. Fan or air-conditioned rooms, shared or simple facilities, and the lowest rates in the city.
- Mid-range: private rooms in small hotels, including waterfront and town centre properties, typically with air conditioning, en-suite bathrooms and WiFi. Some come with simple breakfast and tour arrangement services.
- Splurge: the most comfortable rooms in the city are found on the waterfront esplanade, with air conditioning, WiFi and in-room entertainment, and harbour views in some cases.
Best area for a first visit
Base yourself in the town centre for a first visit. It keeps you within walking distance of the central market, the bus station and the banks, which is where you arrange transport and tours to Sepilok, the Turtle Islands and Gomantong Caves. It also has the widest spread of accommodation across the price tiers, so you can match the area to your budget without committing to a location that is hard to leave.
Frequently asked questions
Should I stay in the town centre or on the waterfront?
Both are close together and within walking distance of the central market, so the choice is mostly about atmosphere. The town centre is more convenient for the bus station and everyday services, while the waterfront and Harbour Square give you harbour views and a short walk to the market.
Where should I stay if I am visiting Sepilok?
Accommodation along North Road sits between the bus station and the city centre, on the road leading out toward Sepilok. Staying there shortens the trip to the sanctuary, though you will need transport for the town centre and waterfront.
Is the town centre noisy?
It is the busiest part of the city, with the central market and bus station nearby, so expect street noise in the busier blocks. If quiet matters to you, look at the waterfront, North Road or Bandar Kim Fung instead.
Do I need to worry about stairs?
Some buildings in Sandakan are several storeys with no lift, including properties in the town centre and on the waterfront. If stairs are an issue, ask about the floor and lift access before you book.
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