Martinhal Beach Resort and Hotel, Portugal

The charm of the wild stretch of sand on the south-west tip of the Algarve that constitutes Martinhal Beach lies in its simplicity. There's lots of space for lounging around or running about on the wild stretch of sand, where the Atlantic is in a constant strop. When you tire of your holiday reading, you can stretch your legs with a walk across the headland to see the ruins of Henry the Navigator's fort, the Cape Canaveral of the 15th century. Or you could always just while away the time watching surfers ride the waves, or gulls and waders seek out the waters of the tidal pool. True relaxation. What more could you want?

Turn your back to the sea and consider a new vision of what visitors to Martinhal might desire. At the top of the beach, where there was once just the pines and maritime scrub of the Costa Vincentina Natural Park, stands a flash new hotel with a legion of holiday houses, the Martinhal Beach Resort & Hotel.

Sounds like eco-vandalism. But it isn't, at least to my mind. This plot of land had been scythed by a road and earmarked for development back in the 1980s – before people gave much of a thought to letting diggers mow down Mother Nature and get so close to the seashore. All sorts of monstrosities could have scarred this fragile landscape. Fortunately, the final plan was put in the hands of Roman and Chitra Stern, Nigel Chapman and Nicholas Dickinson.

Fans of hotel breaks might recognise those last two names as the original team behind Woolley Grange, the stylish, unstuffy, family-friendly retreat in Wiltshire that won a generation of affluent British parents over to the idea that hotels could genuinely welcome rather than tolerate kids. Chapman and Dickinson rolled out their now much-copied formula to three more properties before the collection, Luxury Family Hotels, was snapped up by Von Essen in 2006. That family-centred boutique approach also impressed the Sterns, who asked the hoteliers to create and run the hotel at Martinhal, to fulfil an essential part of the planning permission for the whole project.

But Chapman and Dickinson's influence hasn't been confined to the hotel. They also prompted a radical rethink of the resort's architecture, which led to the traditional Portuguese style of the 50 villas completed in the initial build being ditched in favour of an audacious modern interpretation of the landscape by London-based architects Conran & Partners.

Conran conceived a long, two-storey structure for the hotel and set it on the brow of the beach, placing 10 bedrooms with sea-facing terraces at ground level and a glass-fronted lounge and restaurant on the floor above. Twenty-eight more bedrooms and suites were set at one side, in a sequence of huge wood-clad boxes. And, directly below the hotel, the architects laid out a beach club, with a large pool, bar and restaurant.

The box concept was repeated for the design of the 132 resort houses, where the concrete was left bare. Conran made the most of the confines of the original plot by positioning some units to overlook the beach and others facing the bay and the pine woods of the surrounding nature reserve. At the centre of the site, a landlocked space was turned to the resort's advantage with the creation of a walled and gated complex focusing on a vast garden with a pool, designed to appeal to families with youngsters.

A large open-air "Village Square" serves as the the heart of the off-beach action, with an indoor/outdoor pool, shop, bistro, ice-cream parlour, gym, crèche and a club for older children, replete with Wii and foosball tables. Tennis courts and a spa with six treatment rooms, sauna and steam room are positioned in further-flung corners of the resort.

The resort has taken a holistic approach to its impact upon the local environment; both environmental and social considerations have been taken into account. All the buildings have excellent insulation and had been orientated to the sun, and use the rainfall from the roofs on the soil, thereby alleviating pressure on the local sewage works.  Moreover, indigenous plants that required minimal watering were selected – in the Algarve, one of the biggest environmental issues is the over-extraction of water. The resort has also renewed the electricity supply to the nearby town Sagres, and hired many of the 250 staff from the local area; 250 further indirect jobs have been created, practical acknowledgements of its role in the community.

The resort boasts a trio of restaurants. Lunch on the terrace at the chic As Dunas can slip languorously into cocktail hour. Line-caught fish, fleshy hoops of grilled squid, just-landed oysters and clams, and a peculiar delicacy called perceves, a goose-necked barnacle resembling dinosaur toes are served by the beach. O Terraco serves breakfast and gourmet fare, including the chef's sublime starter of sea urchin with scrambled egg served in a half-urchin shell (at €49/£40 the six-course tasting menu is excellent value for money), whilst Os Gambozinos in the Village Square is a more laid back pizzeria-cum-diner.

The resort boasts an excellent spa -The Finisterra, which provides a comprehensive range of treatments, and multifarious diversions including surfing, scuba diving, windsurfing, riding, jeep safaris, nature walks, gourmet picnics and (at preferential rates) golf.

The interiors of all the lodgings are as striking as the buildings, with furniture commissioned from Michael Sodeau, whose work features in London's Victoria & Albert Museum. His covetable designs rekindle artisan skills, using such materials as Portuguese wood and cork fashioned into deceptively simple softly angled shapes. The in-house interiors team, led by Chapman, has embellished the practical look with soft fabrics and fun touches such as sheepskin beanbags and giant basket-weave lamps, sourced with help from London design dealer Twentytwentyone. My timber-clad "beach room" had a decked, bay-facing balcony and the bathroom came with separate shower and oversized tub and cute cane-woven lamps made from Algarvian reeds.

The quality of finish could be no less for a hotel pronouncing itself "Europe's finest luxury family resort". More surprising are the prices, which start at £129 a night in the hotel and £1,100 a week for a house sleeping four – very competitive for the five-star market. But the biggest pull for me is still that wonderful beach.

Martinhal Beach Resort and Hotel, Apartado 54, Sagres, 8650-908, Portugal. (00351 282 620 026; www.martinhal.com)

We flew with award winning low fares airline Monarch, which offers flights to Faro from Birmingham, London Gatwick, London Luton (summer season only) and Manchester airports with fares, including taxes, starting from £46.50 one way (£83.99 return)

In addition to year-round low fares, Monarch also offers a unique range of tasty hot and cold meals onboard with prices from £3.00. Seats can be pre-booked at £7.50 per one-way flight to avoid the last minute free-for-all experienced on some other airlines, or for only £20, extra-legroom seats are available, which offer up to six inches of extra space.

Passengers travelling on scheduled flights can also avoid the queues at the airport and take advantage of online check-in which is available between 18 days and 4.5 hours prior to departure.For further information or to book, please visit www.monarch.co.uk.