Everyone stays here or at the Point when they come to Cusco and with good reason- it is very much aimed at Backpackers.
The rooms are decent and come in a variety of sizes.
The evening meal (10 soles- $4) was always delicious and huge portions- just sign up on the board before 5pm (and actually, can usually add name a bit later). And for breakfast, bread, jam and tea are provided free but I would recommend the bacon and eggs (about $2) which was a real taste of home! The pancake was also good!
The bar provides a great view over Cusco.
A couple of downsides- the reservation service is appaling- they cocked up our reservation on all three occasions we stayed there. Although they also cocked up our bill saving us about a tenner each time so we couldn't complain too much! And the walk back from town is up a very steep hill!
Unique Quality: The great view from the bar.
The fantastic breakfasts.
The cheap and good evening meals
Directions: Ten minutes walk (steep hill) from the main square
There are a gazillion young travellers here all frantically telling their stories about almost getting eaten alive by jungle trantuallas. It definitely has a party atmosphere and you won't mingle with locals, but the company can be appreciated after experiencing weeks of empty hotels in South America. They also had very reliable hot showers. All of the other hotels/hostels that I stayed in around Cusco were quiet, nice, and a little bit lonely (this drove to hang out with many Peruvians so it turned out for the best). If saving money and privacy is your primary objective, you can get a single room at a decent other hotel for the cost of a dorm room at Loki.
Unique Quality: Nice views and free internet
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Address: Cuesta Santa Ana #601, Cusco, Peru