Hlemmur Square

Where Laugavegur Meets the Old Bus Terminal

At the eastern end of Laugavegur, Reykjavik's main commercial artery begins to thin out and the buildings grow a little rougher around the edges. This is the Hlemmur end of the street, anchored by a converted 1930s bus terminal that once served as the city's primary transit hub. The structure has since been transformed into a food hall and hospitality property at Laugavegur 105, operating under the name Hlemmur Square. The neighbourhood sits at a useful crossroads: close enough to the city centre to be walkable from most downtown addresses, yet far enough east to carry a slightly different energy than the boutique-dense blocks near Ingólfstorg square.

Reykjavik's hotel market has bifurcated over the past decade into two recognisable camps: the internationally branded properties that cluster around the waterfront and the Borg area, and the smaller, design-conscious independents that have taken up residence in converted or repurposed buildings. Hlemmur Square belongs firmly in the latter group. Its address inside a historic terminal building places it in a lineage of adaptive reuse projects that have given Reykjavik some of its more architecturally interesting places to stay. Properties like the Hotel Holt- The Art Hotel and the Black Pearl operate in a similar register, where the building itself carries editorial weight. For comparison across the branded end of the spectrum, the Canopy by Hilton Reykjavik City Centre and the Hilton Reykjavik Nordica offer a different positioning entirely.

The Food Hall Below: Hlemmur Mathöll

The ground floor of the Hlemmur building is occupied by Hlemmur Mathöll, one of Reykjavik's more credible food hall concepts. Iceland arrived at the food hall format later than many European capitals, and the Hlemmur iteration draws on local producers and shorter menus rather than the sprawling multi-cuisine model common in larger Nordic cities. The hall has served as an informal anchor for the neighbourhood's food scene, with vendors rotating over the years and the overall offer skewing toward Icelandic ingredients: lamb, skyr-based preparations, and local seafood that reflects what the country's fisheries actually produce at volume.

For guests staying at Hlemmur Square, the food hall relationship matters practically. It shapes the morning and informal dining experience in a way that a conventional hotel restaurant does not. Rather than a fixed breakfast room with a set menu, the building's configuration points guests toward a market-style environment that rewards some degree of self-direction. This is increasingly a studied choice in the independent hotel sector across Northern Europe, where the line between hotel amenity and public food venue has been deliberately blurred to create properties that feel rooted in their neighbourhoods rather than insulated from them. The Alda Hotel and Apotek Hotel by Keahotels represent nearby properties where the relationship between the building and its surrounding food environment follows a different logic, offering a useful comparison for visitors deciding which model suits their travel style.

Placing Hlemmur Square in Reykjavik's Accommodation Tier

Iceland's position as a premium short-haul destination from Western Europe and the eastern United States means that Reykjavik carries higher accommodation price points than many cities of comparable size. The independent design-hotel segment, where Hlemmur Square operates, tends to price at or near the midpoint of the city's range, below the trophy properties like The Reykjavik EDITION and the 101 hotel Reykjavik, but above the budget and hostel-adjacent end of the market. The Hotel Borg by Keahotels occupies an older, more institutionally established tier, having operated from its Austurvöllur address since 1930, which gives it a different kind of positioning authority.

What Hlemmur Square offers that the prestige tier does not is proximity to what the city actually feels like at street level outside the tourist core. Laugavegur 105 is a functioning neighbourhood address, not a showcase location. This distinction matters more for some travel patterns than others: visitors who plan to spend significant time eating across the city, exploring Reykjavik's east side, or using the property as a base for Ring Road departures will find the location logical. Those arriving primarily for a luxury city-break experience may weight the waterfront properties or the Hotel Holt more favourably.

Iceland in Context: Where Hlemmur Square Sits in the Wider Accommodation Picture

Reykjavik functions as the entry and exit point for the vast majority of Iceland visitors, but the country's most compelling accommodation experiences are often distributed across the landscape. Properties like ION Adventure Hotel in Nesjavellir, Eleven Deplar Farm in the Troll Peninsula, and Hotel Ranga near Hella operate in a completely different register, one defined by remoteness, aurora access, and outdoor programming rather than urban convenience. Vogafjós Farm Resort and Hótel Búðir in the west add further range to what Iceland's hospitality sector looks like beyond the capital. For visitors structuring a multi-night itinerary, Hlemmur Square makes more sense as the city-side component of a split itinerary than as an anchor for an exclusively Reykjavik-based stay.

Those extending travel further afield will find that properties like Silica Hotel near the Blue Lagoon, UMI Hotel in Vík, and Hótel Klaustur Iceland cover the south coast corridor that most Ring Road itineraries follow. Skálakot Hotel in Hvolsvöllur and Hótel Reykjahlíð in the Lake Mývatn area extend coverage to the north. For our complete editorial overview, see our full Reykjavik restaurants guide.

Planning Your Stay

Hlemmur Square sits at Laugavegur 105 in the 105 postal district, walkable from the central shopping and dining corridor and a manageable distance from BSÍ bus terminal, which serves most long-distance coach routes to Iceland's interior and coastal towns. Visitors arriving via Keflavík International Airport should allow roughly 45 to 50 minutes by Flybus or similar coach transfer to reach the city. The neighbourhood is most active in the summer months, when Laugavegur operates at full capacity and the food hall draws a cross-section of locals and visitors. Winter stays carry a different character, with shorter days but easier access to northern lights viewing from the city outskirts and less competition for restaurant reservations across Reykjavik's dining scene.