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The Angermeyer family, descended from German settlers on the run from Hitler, still manages this fine hotel, which is rooted in the island's history. Building materials including volcanic stone and driftwood link the hotel to Santa Cruz's geology and nature; the reception area is built into the cave that sheltered the very first Angermeyers to arrive. Whitewashing and wood give the hotel, including its spacious rooms, a rustic feel not unlike that of traditional Andean haciendas, and most rooms enjoy stunning views of the turquoise waters of Academy Bay. Three suites have Jacuzzis. A private pier provides access to town. My only quibble for the price is the lack of a pool, although Playa de los Alemanes (Germans' Beach) and the spectacular Las Grietas are only a few minutes' walk away.