Europe -  Stockholm

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Stockholm is the economic, financial and business centre of Sweden, as well as a leading regional player, particularly in the emerging Baltic markets and within the EU. Although Sweden opted out of the European Monetary Union (euro), Stockholm’s main trading partners are all European. The offices around Hamngatan and Sergelstorg control one of the most powerful economies in Europe. As such, the city ranks as a leading financial centre in the Nordic countries with a prevalence in areas such as innovation, technology, availability of capital and quality of life.

The service sector is dominant in the city and, as such, professional, scientific and technical companies account for around a quarter of the private businesses in the Greater Stockholm area, employing more than 13,000 people. The biggest employers in Stockholm are private security company Securitas AB, telecommunications company Ericsson, fast fashion company H&M, household goods company Electrolux, construction company Skanska, and car and engine manufacturer Volvo. Other leading employers include the three main banks – SEB, Swedbank and Handelsbanken – and construction company NCC.

Stockholm is attractive as both a tourist destination and a city for business. However, Stockholm is commercial in nature: it is broadly recognised that business travellers accounted for 60% of the total demand in the city before the COVID-19 pandemic. Nevertheless, the number of nights from leisure visitors has increased significantly in the past few years, whilst guest nights from business travellers has risen more slowly.

Stockholm’s hotel market experienced a substantial increase in supply from 2017 to 2019 with more than 3,500 rooms added to the market, resulting in a slight occupancy decrease from the mid-70s to around 70%. The city’s hotel pipeline is, however, quite modest, with projects representing 3.2% of the current room stock. Prior to the pandemic, rates were also decreasing in euro terms despite the solid growth in both business and leisure demand, as a result of the weakening of the Swedish krona. COVID-19 brought an abrupt drop in performance. Although Sweden mostly remained open throughout the pandemic, hoteliers experienced a significant demand decline in Stockholm broadly in line with other Nordic capitals.

In terms of transactions, Stockholm was exceptionally active in 2021, with a record total investment volume of €597 million or €449,000 per key, distorted by the prominent sale of the 248-room Grand Hotel Stockholm sold in June 2021 to the Swedish asset management firm FAM AB for approximatively €355 million or €1.3 million per room. Other transactions include the 70-room Villa Dagmar sold by the Stockholm municipality in August 2021 for approximatively €52 million or €739,000 per room, and the 182-room Akka 10 hotel sold in April 2021 for approximatively €29 million or €161,000 per room. Overall, hotel values increased by 5.2% in 2021 compared to 2020, in line with the European average recovery in value.

Change In Value For Market: (€Euro)

Legend
Significant Value Increase: Greater than +10%
Moderate Value Increase: Between +3% and +10%
Stable Values: Between -3% and +3%
Moderate Value Decline: Between -3% and -10%
Significant Value Decline: More than -10%

For more information, please contact:

Sophie Perret, MRICS, MBA

[email protected]
  • +44 20 7878 7722 (w)
Nikola Miljković

[email protected]
  • +44 20 7878-7724 (w)
  • +44 7 593572865 (m)
Mathilde De Bona

[email protected]