The range of lodging in David [1] has much improved in recent years, with good options both for budget travelers and those with a bit more to spend. Accommodations tend to be clustered around Parque Cervantes [2], in the heart of town.
Note: There’s a high-profile hotel, Las Olas Resort, on Playa Barqueta not far from David. It’s not included here for a couple of reasons. First, it’s a rather generic place that started life as an all-inclusive hotel on an isolated stretch of beach with huge, pounding waves that don’t lend themselves to safe or comfortable swimming. More recently, construction at the hotel and an associated condominium development has generated a great deal of controversy for allegedly causing serious environmental damage.
Links:
[1] http://www.moon.com/destinations/panama/western-highlands/david
[2] http://www.moon.com/destinations/panama/western-highlands/david/sights