The hotel was built in 1912 by Peder J. Næss. Hofslund had originally been an inn and trading post. Additionally, there was a coaching station for travellers bound for Solvorn and Hafslo.
Peder J. Næss was from the Romsdal valley and together with his wife Anna he had already built the Halsa Hotell in upper Romsdal. In 1908 he purchased the old inn premises at Hofslund in Sogndal and moved there. In 1912 Næss redeveloped the old inn and the "tingstova" into a new hotel which was given swiss-style facades. The hotel had at this point 34 beds.
Peder J. Næss was a communication pioneer in Inner Sogn. In 1916 he founded the Indre Sogn Automobil Company which was the predecessor of Sogn Billag. The company ran routes between Sogndal and the villages in Luster and Jostedalen. He was also part owner and developer of the Jostedalen Turisthotell which was built in 1920. For a short while, Peder and Anna Næss also owned and ran Tørvis Hotell in Marifjøra -where Anna originated.
In addition to a great interest in tourism, Peder J. Næss founded Sogndal Cementindustri at a sand quarry by the old vicarage in Sogndal.
From 1926 Næss' daughters, Rannveig, Guro and Anna ran the hotel until 1936, when Melchior Sviggum, married to Rannveig Næss, bought the hotel. In 1962 the hotel was extended -and toghether with following extensions the hotel today has 98 beds.
In 1982, Rannveig and Melchior Sviggums son Tore Sviggum took over Hofslund Hotel and ran it together with his wife Aud.
From 2002, Tore Sviggums niece, Mona Sviggum took over Hofslund Hotel and now runs it together with her husband, Leif Gunnar Johnsrud.