If you want to sleep before 2am, do not book here DURING THE MONTH OF JUNE. Alfama area hosts a month-long Lisbon festival - and there is a live music playing every night. Since the location is in the center of Alfama, especially near San Miguel church (where is the live music stage), you will hear it from your room all the time. Plus, there is a speaker attached to the building - so you will not be able to avoid it. If you want to enjoy the party every night, go ahead.
If not in June - this would have been a great location walking distance to everything in the old town.