This was a wonderful surprise. The 3-person room turned out to be an apartment (1/4 of a building, I think), right on the water. Loved watching the birds from our porch and able to pop out to walk and watch the sunset. The apartment is renovated from one of the original Blonduos buildings and has been furnished with an old-time aesthetic. The sitting room was great. The kitchen has everything you need to eat at home (in Iceland, that saves a lot of money). Breakfast was provided back in the regular hotel and was typical Icelandic (plus a waffle maker) and excellent.