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Where should we stay in Panama City?

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We will be in Panama City for 4-5 days in July, flying in from Bocas del Toro and we will be 2 families-4 adults and 4 teenagers.
We need recommendations on where to stay in Panama City-should we get a hotel, B and B, rent an apartment, or some other option?
What area of Panama City would be good?
What could we do that teenagers would enjoy? (they are adventuresome teenagers)
The adults are not into doing group tours-they like to hike, bird, etc.
Any suggestions would help.

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