This buzzy hybrid offers both hostel dorms and hotel rooms in a five-story building on Reykjavik’s main drag, Laugavegur. The lower floors contain the hostel, while the top floor has hotel-style rooms, all of which were designed by hotelier-owner Klaus Ortlieb (of NYC’s Gotham Hotel and London’s Claridge's). The hostel rooms are simple but smart, featuring metal-frame bunk beds, designer armchairs and sofas, and wooden tables. The 18 hotel rooms are much more impressive, featuring elegant coffee-and-cream color schemes, king-sized beds draped in Lissadell linens, and en suite bathrooms with C.O. Bigelow bath products. Most also come with private balconies that look out over the city’s colorful rooftops and the mountain landscape beyond. The hotel’s spacious, old-fashioned lobby/bar area—dotted with antique furnishings, exotic wall hangings, and leather sofas and armchairs—is a popular hangout in its own right. There is also an on-site movie theater with a carefully chosen collection of Icelandic films.