The Breakwater Lodge is in a
former prison but offers comfortable and clean, albeit small, rooms right on the waterfront for the lowest cost.
The Breakwater also houses the UCT Business School (which is held in the more prison-looking parts). The staff of the hotel are also students in hotel management. This can result in a slow check-in/check-out process, (as it did for us--about 45 minutes on each end--no kidding) but otherwise the hotel was very well run and maintained.
Our room had two twin beds, a night stand and generous cupboard space, (although that left little floor space for our suitcases). A little kettle and tea making supplies were provided as was a color-TV with remote. We shared a shower room and a toilet with the room next door so that when you came in from the hallway you were in a little foyer with four doors (one to your room, one to the room next door, one to the shower, one to the toilet). This is great if you have friends staying next door, but really weird when you go to the bathroom in the middle of the night and run into a sketchy man wearing only a towel. For a little bit more, you and a friend could each have your own room and share the bath or you could have a larger room with two beds and a private bath. Because we shared a room and shared a toilet with another room, we each paid only $15/night.
The location can't be beat for this price. There is a cafeteria in the business school where you can get breakfast for less than $2. Just across the street from the hotel is the aquarium, crafts market and IMAX theatre. It's about a 10 minute walk to the Nelson Mandela Gateway to Robben Island or the entrance of the Victoria Wharf shopping center.