16.05.2014

HotCop 2014 provided an interesting overview of the Scandinavian hotel market

Tourism has increased significantly in Finland in recent years, despite the slowing down of the global tourism business. Together with a new tourism strategy and the government’s strong commitment and support to the industry, Finland aims to be even more competitive as a tourist destination.

Presentations and panel debates with industry heavyweights provided thorough insight into which hotels will be needed in the near future and where, as well as, what the drivers of change and development will be in the market.

Hotel market sees an upward trend towards higher profitability in all Nordic countries.

According to Johan Johander of Benchmarking Alliance, the hotel market in the Nordic countries is picking up. The occupancy of Q4 2013 differed very little from one city to the other, but the similarities cover big growth in several capitals.

The budget and luxury hotel segments are doing very well, both segments showing an average increase in revenue of 15% and 7% respectively.

The hotel supply will increase in all Nordic capital cities in the coming years. In Helsinki, it is estimated that there is room for 2000 new hotel rooms, and the pipeline estimates for the other capitals are similar.

Erik Jacobs from Invesco presented charts that showed how well hotel property investments have fared in comparison to other types of property investments. According to the data, hotel property investments have been very profitable, with annualized total returns of some 7% on a 10 year basis. This is in fact higher that the returns on retail and office properties.

Invest in Finland, Cursor Oy, Invest in Lapland and Laatumaa were also present at the conference in Copenhagen to discuss the growing opportunities that Finland has to offer international hotel operators, investors and developers.