Hassle-free, homely and very friendly is how I could describe Señora Milenka property. As others have noted, guests are their most important matter. Hostel is located in front of a big park where you can take a morning stroll. The main plaza and most of touristic attractions in the city itself are a few minutes away walking (literally, 10 min); or you can always take a taxi for under 1-2 dollars. Away from the noise of downtown hotels and the pollution of the city center, it's a big plus. While the hotel does not have a restaurant, they can fix you a sandwich and fruit juice easily. Most places to eat are in nearby downtown; but Milenka can also order a pizza, burger or pasta delivery for you. Don't forget to ask for a 'maracuya con leche', one of the best I've had. In talking to Señora Milenka, I learn that her family have been hoteliers for at least 2-3 generations and it shows. If you are traveling to Puno, she can recommend one of her sisters locales. One big example of her care is as follows: another traveler's sister was stomach sick in her room and this traveler was trying to figure out how to get something to eat for both, would have to be something special. Milenka immediately offered to prepare special sandwiches and juice such that it would provide the nutrition and yet be soft enough to the stomach that it would be fine.
They can also arrange for airport pickup, order you a safe taxi to go back to airport, bus terminal, etc.
Property has ample rooms (about double the size of a 3-star European property in a major city), clean, quiet. Private bathrooms are the norm in Peru, and these ones are good and clean, hot water all the time.
I only stayed one night as this visit to Arequipa was more on the business side; but I will be returning to Milenka's property next year with my wife, this time for several days.
I can easily say that this hotel is one of the best I've been in a 3-star category within Rome, Paris, Madrid, Krakow, Stockholm, etc. For a US comparison, think Holiday Inn but keep in mind this is not a hotel chain nor a motel, thus you will get a more personalized stay.