Built in 2002, this hotel stands next to the Ermita de Gurutzeaga, in a residential district of Donostia-San Sebastian and offers views from the rooms as it lies in the high part of the city. The four star Palacio de Aiete is named after one of the most beautiful monuments of the city of San Sebastian, the 'Palacio de Aiete' which was built by the dukes of Bailen in 1878 and in it stayed the most important personalities in politics as guests. The palace has lodged Alfonso XII and Queen Maria Cristina and from 1940 to 1975 it was the residence of General Franco. Its gardens were opened to the public in 1977.

The hotel offers 75 soundproofed rooms, all equipped with air conditioning, central heating, telephone, colour satellite television, internet access, background music, mini-bar, safety deposit box, bathroom with hair dryer and choice of pillows.

Facilities at the Palacio de Aiete include convention rooms equipped with air conditioning, central heating, external telephone, audiovisual equipment, background music and internet wi-fi. The hotel also offers private parking, gourmet breakfast, restaurant, bar cafeteria, laundry service, sun terrace, gymnasium and sauna.