The Blue Chairs Hotel is in the center of the action during the day. It is right in front of the gay beach, thus you don't have to walk up and down the large hills surrounding the bay (this can be an issue if you have been at the beach all day drinking and eating). I also found that the hotel itself is very nice, friendly staff, decent restaurant. The sunset rooftop party is not to be missed, great views and big crowd. You often can see whales in the bay from the rooftop bar.