The Olde Empire Hotel is opposite the entrance to the Temple of the Tooth, and offers fantastic value for money. The rooms are clean, and to the front of the hotel there is a large veranda with seating which allows you to watch the actiivities in the street and temple complex in front of the hotel. When we stayed the hotel was being refurbished after a fire, but this didn't impede our stay.
The owners and staff are very hospitable and helpful, helping organising onward travel arrangements. We stayed in a room which used the shared toliet/shower facilities -- these were very clean. We enjoyed our stay here and will definetely return when we come back to Kandy in the future, and look forward to using their restaurant which will be re-opened following completion of the refurbishments.