This was a decent 3* hotel located in the very center (between Puerta del Sol and Gran Via) and costing only E75 including breakfast (which was very decent). The place is clean (even though you have to make an effort to get your towels changed often), has free internet in the room, a warm breakfast and courteous staff. There is plenty of storage and you can rent a safe for E1.
Rooms are rather cramped, beds are extra firm, and additional soundproofing could not hurt, but for the price the place is simply incredible.
Just be aware is that a couple of blocks towards Gran Via there are prostitutes. They don't really bother anybody, and I guess this is a part of staying in a big city.
Unique Quality: GREAT price to quality ratio = outstanding value.
Directions: between Puerta del Sol and Gran Via
Stayed at the Hotel Ateneo. This is a very pleasant three star about 1 minute off Peurta del Sol. From the moment of arrival I had a good vibe about the hotel and that was amply born out. The hotel staff were pleasant to deal with and the room I was assigned to was a pleasure, being clean, modern and reasonably well-insulated. The Ateneo Breakfast really set me up for the day ahead - you can have continental breakfast if you want but there is a wide selection of food available.
Only less than optimum point is the street the hotel is located on. Its a bit seedy and frequented by hookers. But then they are hard to avoid in parts of the city centre, are not aggressive and if you turn down into Paza del Sol from the Hotel you may not see any (they cluster at the other end of the road)
Will definitely stay at this hotel on my next visit to Madrid!
Unique Quality: Location, Location!
Free internet access in the lobby was good.
Staff were very pleasant and can arrange a minibus back to the airport at a reasonable price if you don't want to carry your bags on the train (a possibility if you go there with shopaholics who won't be able to resist some of the bargains on offer :-)
Directions: Just off Puerta del Sol
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Address: Montera 22, Madrid, Madrid, 28012, Spain