Istanbul

Does it have to be near the Grand Bazaar? I used the Erboy Hotel and loved it (comfortable modern rooms, excellent breakfast, terrific staff). It's also central, walking distance to many sights and close to the tram, but but it is a little far from the Grand Bazaar.

I used the hotel's shuttle offer and had to wait quite awhile for it at the airport. Returning was easy on by tram, but I was familiar with it by then.

Zeugma Hotel near the Blue Mosque and Hagia Sophia worked well for us. Took the metro from the airport, transferred to the tram and had a less than 10 min walk to the hotel from the tram stop. I think it took about 45 min total. The hotel is in easy walking distance to most of the sites you will want to see in the Old Town including the Grand Bazaar or you can take the tram a couple of stops to get there.

We've stayed at the Adamar. Advertised as a 4star, its more like a really good 3star with some 4star amenities. The view from the roof top restaurant is stunning and the location is very nearly perfect: If we wanted to return to Istanbul I would stay there again in a heart beat. http://adamarhotel.com/gallery.php

I just returned from Istanbul and stayed at the Valide Sultan Konagi. I highly recommend it. The staff was excellent, the views of Hagia Sophia or the Bosphorous (depending on which side of the hotel you are on) are breathtaking and they arranged airport shuttle each way for under $40 total. I walked to and from the Grand Bazaar a few times and it was not far at all. If you are going to stay in Sultanahmet, give this hotel a try!