Palácio de Tavira

A Moorish-style palace that spent centuries as a noble family's home before becoming a 36-room boutique hotel, and the transition shows in all the right ways. Contemporary interiors with clean lines sit alongside local crafts and Algarve colors, with rooms split between the original house and a medina wing wrapped around courtyards and gardens. A spa keeps things properly resort-like. Tavira isn't flush with places like this, which explains a lot.