Icelandair Hotels aims to profitably market and operate two hotel chains: All-year hotels under the trademark Icelandair Hotels, and summer hotels under the trademark Edda Hotels.

The airline Loftleidir started to operate a small hotel at Keflavik Airport in 1962 and built the Hotel Loftleidir in 1966 in Reykjavik. After being a part of the general operation of the airline for over 30 years, the hotel arm was turned into a separate and distinct subsidiary in 1998. The Managing Director of Icelandair Hotels is Magnea Thórey Hjálmarsdóttir.

Icelandair Hotels operates and markets two hotel chains: all-year hotels under the trademark Icelandair Hotels, and summer hotels under the trademark Edda hotels. There are 8 Icelandair hotels and 15 Edda hotels. While the company itself operates 15 hotels, 8 hotels are operated under the trademarks of Icelandair Hotels by associated partners around the country under special franchise agreements. Icelandair Hotels rents all real estate which the company uses for operations.