Helm and Cloak can be found in the most northwestern part of Baldur's Gate. It's a luxurious inn that provides drink and beds for their patrons. The name originates from the fact that the helm and cloak of Balduran is hidden somewhere in the inn. You can also find the Merry Fools here. After talking to them, the group called the Maulers of Undermountain moves in and will attack the player's party, after demanding they clear the way (this will happen regardless of which conversation response the player chooses.) The locked chest in the kitchen contains 450gp, a black Opal, and a garnet gem. There is a "special guest" in the rooms upstairs (front steps), being guarded by two guards that block the way and will not let you past. If the player kills the guards, or gets past by some other means, the guest turns out to be Sara, an emissary from Amn sent to ease tensions between Amn and Baldur's Gate. There is a locked chest in the room which contains 195 gold pieces and an Angel Skin ring. The back set of stairs leads to an office/apartment for the owner, where the Helm of Balduran is hidden behind a painting, in a trapped and locked wall safe.
You can either rest here or take some drinks and hear some gossip, rumors and news.
You can hire all four rooms and the enjoy the following drinks (ranging from 1gp to 20gp); Alurlyath wine, Blood wine, Firewine, Mead, Evermead