A plaza near the harbor. Lots of outdoor cafes. There were lots of tourists there, but also lots of local people. Communication was a bit tricky, since they don't seem to speak much English (unlike Spain where all shop owners spoke English) and I certainly don't speak Portuguese, but we managed to order some coffee/tee and a lunch. They also had free wi-fi. Yipee! The wi-fi on the cruise ship was sooooo lame that I was always looking for free wi-fi when I was on shore.
This is a closeup of the artist who was sitting under the yellow umbrella you can see on the right side of the above photo.