Based on info from http://peterdowns.com/posts/open-iterm-finder-service.html but with modified behavior and fixed to work with iTerm2 version 3 or later. It will not work with older versions of iTerm. The modified behavior is to open a new terminal window for each invocation instead of reusing an already open window. Update - The original author released a build script for the newer iTerm2 versions at https://github.com/peterldowns/iterm2-finder-tools that keeps the original behavior of reusing an open iTerm2 window.
To open iTerm2 at selected folder with keyboard shortcut
- Run Automator, select a new Service
- Select Utilities -> Run AppleScript
- Service receives selected 'folders' in 'finder.app'
- Paste script: