Whenever we go to Puri, we stay at this hotel for these reasons -
1) It is right at Swargdwar so we don't have to walk a lot to get there.
2) Lots of shops near this area to get some local handicrafts.
3) Most of the crowd is right around this area - so people watchers this is a good place for you!
4) The little restaurant at this hotel serves good food (at least for my palate) so that's a big plus!
5) And the main thing - it is right across from the beach, just like many others but still that counts big time :)
I have stayed at this hotel many times and never thought of going to another hotel for any reason. The tariff is also very affordable, the rooms are clean and neat, the balcony has a sea view (not that you would stay in the room but still).
Eating jhalmuri right below the hotel is a lot of fun...do try it the next time you are in Orissa.