5 Best Hotels In Reykjavik You’ll Love

Reykjavik may be best known as the gateway to Iceland’s natural wonders, but it’s also a vibrant city home to several hotels redefining contemporary luxury.

Whether you see yourself in an ultra-modern chic highrise or surrounded by the most extensive collection of Icelandic art, Reykjavik has the sanctuary you crave. And because Downtown Reykjavik is not that big–you can walk end-to-end in under 30 minutes–there’s no issue being near all the main attractions.

Still, we’ve only selected our favorite hotels, all within five-minute walking distance from the heart of Reykjavik, the Rainbow Street that runs from the famous Hallgrimskirkja church to the main street of Laugavegur. This is also where you’ll find our favorite date-worthy Reykjavik restaurants.

Pack your bags; here are the five best hotels in Reykjavik, plus a bonus splurge-worthy resort you won’t want to miss!

Exterior of Hotel Borg, one of the luxury hotels in Reykjavik

Historic Luxury – Hotel Borg

Set across a quiet green square from Althingi Parliament House, Hotel Borg combines old-world elegance with modern luxuries.

Convenient to all of Reykjavik’s downtown attractions in a location that is close to the city center, it’s at the end of town that’s also closer to the Harpa Concert Hall and whale watching embarkation point.

Art deco interior at Hotel Borg

Nonetheless, the hotel’s location off the main thoroughfare means that you immediately experience a sense of peace and relaxation upon arrival. That feeling extends to guest rooms that are much larger than typical city rooms.

And continues with windows overlooking park gardens or with bathrooms featuring soaking tubs.

Guest room at Hotel Borg

Most relaxing of all, hotel guests receive complimentary access to the spa, where they can enjoy the steam room, sauna, hot tub, or fitness room. A full range of beauty treatments are available, including facials and massages, that incorporate Icelandic skin care products.

Hotel Borg spa

An in-house restaurant serves breakfast (at additional expense) as well as fine Icelandic cuisine. Parking is not available at the hotel, but a parking garage is nearby.

Hotel Alda lobby

Reykjavik Main Street – Hotel Alda

Hotel Alda is your best choice if you want to be where all the action is. The boutique hotel is located on Laugavegur, Reykjavik’s shopping street.

Floor-to-ceiling windows in the lobby are great for people-watching and a light and airy place to hang out. And yet Hotel Alda has one unique feature – a very hip barber shop.

Hotel Alda barber shop

Rooms are cozy with Icelandic wool accents, even extending to fixture covers. Fine-quality linens elevate the standard bed configuration we saw all over Iceland–twin beds that are joined into one upon request.

And as is typical here, separate covers even for king beds.

Hotel Alda room

Hotel Alda has a good-sized fitness room leading to a courtyard outfitted with a hot tub.

Hotel Alda hot tub

Breakfast is available at an additional expense. Remember that loading and unloading can be challenging because it’s located on a busy thoroughfare. Street parking, free after 6 p.m., may be available nearby, and there is a parking garage just down the street.

Canopy By Hilton City Center hotel in Reykjavik lobby

Canopy By Hilton City Center

Canopy By Hilton Reykjavik City Center combines the best of both worlds by being right off Laugavegur Street, on a side street of the downtown area. So, it’s at the heart of the city without the hassles of being right on the main street.

And because it’s one of Hilton’s lifestyle boutique hotels, it’s a fun place to stay.

Canopy By Hilton City Center hotel in Reykjavik happy hour

The lobby is a welcoming spot to hang out, while Happy Hour at the bar is a great way to meet other guests.

Canopy By Hilton City Center hotel in Reykjavik breakfast bar

When booking the hotel, you can select a Half Board option that includes breakfast and dinner. The hotel does not offer free parking, but a parking garage is only half a block away. And, of course, there is the benefit of using (or earning) Hilton points.

Marriott Hotel In Reykjavik

If you prefer to use (or earn) Marriott points, consider the 101 Hotel, a member of Design Hotels. It’s one of the most stunningly beautiful hotels in the city, featuring an excellent collection of modern Icelandic art.

Hotel Skuggi lobby

Downtown Reykjavik Boutique – Hotel Skuggi

Experienced Iceland visitors, who return year after year choose Hotel Skuggi. The boutique is located only one block from Reykjavik’s Main Street and within a 3-minute distance from Rainbow Street. But it offers a number of amenities at no extra charge.

Hotel Skuggi guest room

Guest rooms are snug, but we like the quotes on the walls. They’re taken from a coffee table book about Iceland photography found in each room. Rooms feature an electric kettle with coffee/tea, although the discounted beer at Happy Hour may be the beverage of choice.

If you request a room on the 4th Floor, windows open out onto a balcony that runs 180 degrees around the building. It’s a lovely spot to watch sunsets, and if you squint, you can even see the top of the waterfall-shaped Hallgrimskirkja landmark. And if you’re very fortunate indeed, you might even spot the Northern Lights above.

A very extensive breakfast buffet is included. But perhaps the best perk we like at Hotel Skuggi is the parking in the indoor basement garage. It’s both free and convenient.

Hotel Holt exterior

Hotel Holt – Art In Central Reykjavik

Constructed in 1965, with interior design by renowned designer Gunnar Magnússon, Midcentury Modern Hotel Holt features a more extensive collection of Icelandic art (the largest private collection) than even city museums. In fact, there are over 450 works on display, from a total of 1560 pieces.

Hotel Holt lobby

Paintings and sculptures are on view in the lobby, bar, restaurants, hallways, meeting rooms, and even guestrooms.

Hotel Holt art

The collection includes over 500 paintings by Jóhannes S. Kjarval, one of Iceland’s most influential and prolific artists. His style varied greatly but included both the realistic and fantastical that drew inspiration from Iceland’s landscapes and folklore.

Hotel Holt mural

You can learn more about the art collection online or ask to see the gallery binder at the front desk.

Hotel Holt guest room

As for the hotel, the guest rooms are comfortable, if a little overdue for an update. Breakfast is available (for a fee) in the main dining room. Parking is free in the small outdoor lot.

Note that Hotel Holt is a little removed from the City Center. It’s located on a residential street on a hill behind The National Gallery of Iceland, but it’s still only a 4-minute walk from Rainbow Street. And one of Reykavik’s most romantic restaurants, the award-winning Three Coats, is just around the corner.

Blue Lagoon exterior

Bonus Splurge Hotel

If you have time for one more Reykjavik hotel, consider splurging at a resort that’s actually near the airport. The Retreat Hotel at the Blue Lagoon is the perfect place to kick off an Iceland vacation or wind down after an island-wide road trip.

geothermal pool at the Blue Lagoon

With an overnight romantic getaway, you can access the geothermal pools’ quieter side and the legendary spa treatments and partake in signature dining experiences.

Bonus Extended Stay Hotel

The Kvosin Downtown Hotel is strategically situated in the heart of Reykjavik, offering guests immediate access to key landmarks, dining options, and cultural sites. Housed in a building that blends historic charm with modern amenities, the hotel gives a nod to Iceland’s architectural heritage while providing contemporary comforts. The interior design combines sleek, minimalist elements with warm, cozy touches, creating an inviting atmosphere that reflects the eclectic spirit of Downtown Reykjavik.

Rooms are well-appointed, featuring amenities such as high-speed internet, plush bedding, and kitchenettes, making it suitable for both short-term and extended stays. One of its standout features is its spacious common area, often described as a social hub, where guests can relax, plan their Icelandic adventures, or mingle over drinks.

Iceland Travel Guides

Whether you choose to stay in Reykjavik only upon arrival or departure, or if you stay long enough to explore the capital city’s many attractions, we’ve got you covered. We’ve put together a number of guides for planning your best romantic getaway yet!

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  • Sandra Foyt

    Sandra Foyt is a storyteller, road trip junkie, and award-winning travel photographer. A veteran of many cross-country road trips, she drove Route 66, the Lincoln Highway, the Fossil Freeway, the Extraterrestrial Highway, and even “The Loneliest Road in America.” Sandra is based in Upstate New York, with family homes in California and the Caribbean. Her work is influenced by tropical colors and warm relationships. And she believes that the best travel photography connects us across time, place, and culture.