Increasing number of opportunities in Helsinki’s hotel sector

The number of overnight stays by Russian tourists is expected to rise significantly if visa restrictions are lifted.

Helsinki is experiencing a hotel boom with at least six new hotels planned to open in the next few years and several existing hotels undergoing expansion or refurbishment, according to the Finnish business newspaper Kauppalehti. “The increasing number of hotel projects shows that the sector is preparing for the lifting of visa restrictions on Russian tourists,” says Timo Lappi, Chief Executive of the Finnish Hospitality Association.

Intercontinental Hotels Group (IHG), one of the world’s biggest hotel chains, is opening the 120-room Hotel Indigo Helsinki – Boulevard next year under a franchise agreement with International Restel Hotels Ltd. Restel already operates IHG’s eight Holiday Inn hotels and a Crown Plaza hotel in Finland. Restel has a total of 47 hotels in Finland.

“Helsinki is a good bridgehead between the East and the West. IHG has hotels in Russia and is interested in Helsinki,” says Jari Laine, Vice President of Restel's Hotel Division.

New international investments

Both international and Finnish companies are investing in new hotels in Helsinki. The Norwegian investment company AB Invest AS is planning to build a 16-storey, 400-room congress hotel in the Jätkäsaari district of Helsinki.

Scandic, the market leader in Scandinavia, is currently looking for a suitable location for its new HTL concept which will offer customers smart digital solutions and design. Scandic currently has 24 hotels in Finland and also operates three hotels in the Hilton chain. It is also renewing its old Intercontinental Hotel in Helsinki.

High occupancy rate

The Finnish company Union Hotels has started work on a new hotel in a former police building in the Punavuori district of Helsinki, and is also planning to double the number of rooms at its boutique Hotel Haven located near Helsinki’s Market Square. Finnish construction company Lujatalo is also planning to transform an existing building into a top class hotel with 150 rooms.

Helsinki has a total of 8,400 hotel rooms which is 17% of the 50,000 hotels in Finland. In 2013, Helsinki’s hotels had an occupancy rate of 69.6% which, along with the city of Rovaniemi in Lapland, was the highest in the country.

Source: Kauppalehti, IHG