More than a thousand new hotel rooms in prospect in Helsinki

Competition not affecting prices, as demand remains high

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A record number of new hotels are being opened in Helsinki. In the course of 2007 and 2008, the supply of rooms will increase by 13 per cent in the Greater Helsinki area.
      Nine new hotels will be completed in Helsinki, housing a total of 1,100 rooms.
      The newest hotel belonging to the Palace chain, Hotel GLO (on Kluuvikatu), and the newest flat-rate hotel belonging to the Omena chain (on Eerikinkatu) have already been opened. Prior to them, there were 44 hotels in Helsinki, with some 7,300 rooms.
      The new Hilton Hotel at the airport and the newest Sokos Hotel in the Jumbo shopping centre will increase Vantaa's current capacity of 1,500 rooms by around one-third.
     
Even though the number of rooms and beds is increasing rapidly in Helsinki, there will be enough clients also in the future, as the demand is also growing steadily, believes Research Manager Heikki Lankinen from the Finnish Hotel and Restaurant Association (FHR). Compared with 2006, the growth is expected to slow down this year, while the demand for hotel accommodation is likely to increase again in the future, says Lankinen.
     
Tightening competition does not automatically mean that the prices would come down, as the demand for rooms is not likely to relent, Lankinen adds.
      The current occupancy rate of Helsinki's hotels is 69 per cent. In spite of the growing demand, the rate is likely to drop to some 65 per cent following the large number of new hotels, estimates Ari Björkqvist from Haaga-Helia University of Applied Sciences in Helsinki.
      One marketing method in the competition between hotels is profiling. For example, the new GLO Hotel has been profiled as a lifestyle hotel. Apart from access to various hotel facilities, it is possible for a visitor to do yoga and other exercises as well as to have aromatic spa services in the room.
      "Those travelling on business do not necessarily just want to relax in front of TV with a beer bottle in their hand. They want to engage in some activity, which is now possible without leaving the hotel", says Petri Alanko, General Manager of Hotel GLO.
     
Björkqvist mentions further examples of individual new hotels. The marketing of a new hotel to be placed in the former prison in Helsinki's district of Katajanokka is based on the colourful history of the building. Hotel Helena, a small 50-room boutique hotel that will be built on Pohjoisesplanadi in the so-called Lampa House on the Market Square, will also feature the architectural history of the building. An Alvar Aalto Hotel is also planned for Katajanokka, providing accommodation with furnishings by the famous architect and his Artek studio.
      Even old and established entrepreneurs are trying new concepts. For example, Sokos Hotels will build a new boutique hotel in Albertinkatu, housing less than a hundred rooms. The chain will open a total of three hotels over the course of 2007 and 2008. The total number of new rooms will approach 600.


Previously in HS International Edition:
  At least four new hotels to be opened on prime real estate in Helsinki this year (1.6.2006)
  Helsinki plans to brighten up city centre (20.9.2005)

Links:
  Finnish Hotel and Restaurant Association FHR
  Haaga-Helia University of Applied Sciences

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