Nordic-focused private equity real estate investor, Slättö, has acquired a second hotel in Finland, picking up a aparthotel project in downtown Helsinki.
The building, which was acquired from Catella Real Estate, is currently used as an office. In partnership with tech-led operator Bob W, the asset will be converted into an aparthotel with 99 keys in Helsinki’s central business district.
Slättö’s team has identified hotel real estate as a highly attractive niche in the Nordic real estate market providing interesting investment opportunities, given the shortage of high-quality affordable accommodation and a need for product innovation in the industry.
'The European and Nordic hotel markets are showing a strong performance, as travelling for short and long periods of time is increasing,' said Erik Möller, head of hotels at Slättö. 'There are significant value creation opportunities in apartment-hotel and long-stay properties that have high design standards and technology-driven operations.'
'We are very pleased to add another property to our partnership with Bob W,' said Ilkka Salminen, Slättö’s country head in Finland. 'With two assets in the central business district of Helsinki, Slättö’s portfolio is an attractive investment proposition.'
Emilia Malmi, CEO of Northern Europe at Bob W, said: 'We are excited about Bob W's expansion into Helsinki's Kamppi district, a key location. The property will offer a unique, modern, high-quality hospitality experience. This enhancement of our partnership with Slättö not only boosts our presence in the Nordic region but also cements our position as a market leader.'
Bob W operates design-led, sustainability-focused properties in 16 cities across Europe, with a climate neutral proposition.
Catella Real Estate AG (CREAG) had originally acquired the property in 2011 for the specialised alternative investment fund Catella Scandia Chances.
Axel Bertram, portfolio manager at Catella Real Estate added: 'The sale of the property as a development project took place in a challenging market environment, even in Finland. Coupled with ongoing rental income during the operational phase, the sale profit yields a very favorable return on investment. The fund's liquidity position is strengthened, enabling portfolio optimisation.'
The property will be refurbished and leased to Bob W, while maintaining Lidl as a ground-floor tenant. The 99-room hotel will feature a mix of mini studios and one-bedroom units, each equipped with a kitchenette.
The extensive conversion plans include renewing almost all HVAC systems for improved energy efficiency, replacing or repairing windows, roof and parking deck, and solar energy installation with the goal of achieving LEED Gold certification.
Renovations will begin in Q1 2024 and the hotel is expected to open to the public in Q2 2025.
