Health warning: this will spoil you for all other hotels in Florence.
The location is perfect for sightseeing and exploring on foot the small cobbled streets of Oltrarno with its plethora of small shops and restaurants, as well as palazzo Pitti and the Boboli Gardens, the Ponte Vecchio area, the Duomo and all the other museums in the historical centre. The hotel can help with booking tickets ahead so you avoid the queues - but this can also be done online.
The building itself, in the owner's family for over 250 years, was sympathically restored and opened in 2002 as a suites only hotel retaining many original architectural features but without sacrificing any comfort. For example the vaulted ceilings are dizzyingly high but the rooms are warm in winter.
The suites are all enormous and elegantly furnished but so comfortably you instantly feel at home, with amenities such as TVs and DVD players, minibar, a safe, Bulgari toiletries, a free guide and map to Florence and lots of information in the folder given on arrival. A word of caution: the bottled of wine enticingly placed on a side table and labeled "for your tasting enjoyment" actually costs EUR44, although the charge only becomes apparent upon checkout.
The hotel has many lounging areas, a billiard room, a magnificent breakfast room decorated with antique family portraits. The roof terrace offers spendid views of Florence.
Coffee and tea are available free of charge throughout the day and there's free coffee and cake in the afternoon - we weren't around to try it but think it's a lovely touch.
Breakfast is a huge buffet with sweet and savoury offerings plus you can order eggs cooked to your taste. It can also be served in your suite for a EUR15 supplement but it would be a shame to missout on the beautiful room.
The staff almost all speak English and are extremely courteous and helpful. They kept our luggage after we checked out, lent us umbrellas, booked us a taxi to the station and would have done much more had we asked.
After my second stay there I cannot recommend it highly enough. It's very expensive but check out their special offers on their web site for some real bargains given the quality of accommodation and service.

We stayed here for one week in December 2012, with our 3 year old son. We had a two bedroom suite, with the large living room. This room is huge - seriously these rooms a big. With soaring ceilings and large space it was a great space to play and spend time with our son when we weren't our exploring florence. The service was great too. We had breakfast each morning in the breakfast room which had lots of variety. Less than a 5 min walk to everything across the river. Nice and quiet when we were there. Tip for anyone staying there with a child - if you have a young child I would suggest not having a separate bedroom for them - the two bedroom suite was so big, we ended up not using the second bedroom as we felt we were too far away from our child at night - and probably wouldn't here him - the bedrooms were on either side of the living room. I would suggest organsing for a roll out bed to be placed in the main bedroom of the one bedroom suite, as you can still enjoy the other living space with the bedroom door closed. Downside - I only mentioned this as it may be applicable to people who are unable to go out for dinner at night. We weren't able to go out for dinner at night (early bed time for son), the room service wasnt' great as we had to rely on it each night for our son's dinner. Not much variety and not fabulous.

We just returned from a 4 night stay at the Palazzo Magnani. It was, without a doubt, a highlight of our vacation. This hotel has so many unique and wonderful elements; it is a small and quiet hotel in a gorgeous and perfectly restored palazzo. The location is superb; everything was within a 10 to 15 min walk, and the Ponte Vecchio is 2 blocks away. The hotel is so quiet and peaceful; you'd have no idea you're in the heart of Florence. We stayed in the Guiseppe suite with my 2 children. It's spacious, high ceilings, grand and elegant. From the opera music played at breakfast (delicious buffet), to the handmade soaps, along with the spectacular rooftop patio, this hotel ranks as one of my all time favorites. The staff couldn't be more helpful- an added plus. If you are looking for a quiet, low key and absolutely elegant experience; this is the place!

This wonderful hotel is located in a historic palace and has only twelve suites, along with several public spaces. It is quite grand and would normally be out of my price range, but they were running a special and that allowed me to stay at the Palazzo.

Pros:
The palace itself and the unusually large rooms.
The high level of cleanliness.
The terrific staff.
The location (on “Oltrarno,” the other side of the Arno, near Palazzo Pitti but far from the madding crowd).
The superb breakfast.
The rooftop terrace, with an amazing view of the city.

Cons:
My main beef was with the music. Most of four days I stayed here, there was the worst type of muzak playing, at a relatively high volume, in the lobby and the breakfast room. It made this glamourous Florentine palace sound like an elevator in a cheap department store. Every time I asked the staff to reduce the volume, they did so immediately, but I really think it's time to put on something more classy (or at least not so much in your face). Also, along with the beautiful antiques, there are some pretty tacky pieces (imitation Baroque angels galore). This made me think of the hotel as something of a Jekyll and Hyde: real beauty along with stuff that shouldn't be there. These issues do not detract from the fact that the Magnani Feroni is a very special place and I was delighted to stay there.

Caveat:
As is often the case, the professional photos on the site make some rooms look more beautiful than they actually are, mainly by making things seem brighter and larger.