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Oulu Commercial Investment Guide 2020

Market Area Analysis

Office Space and Business Premise Market

Hotel Market


Oulu

2

Commercial Investment Guide 2020

Content

1

2

3

1.1 Oulu in Brief

2.1 Market Description

3.1 Market Description

1.2 Economic Structure

2.2 Commercial Real Estate Development

3.2 Demand and Supply

⊲ Page 22

⊲ Page 26

Market Area Analysis

1.3 Purchasing Power

Office Space and Business Premise Market

Hotel Market

3.3 Future Hotel Developments

1.4 Accessibility 1.5

Tourism, Leisure Activity & Conferences

1.6 Future Development Areas

⊲ Page 6


Oulu

Commercial Investment Guide 2020

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Oulu

Commercial Investment Guide 2020

Welcome to Oulu! Explore the commercial opportunities in the Oulu Area Oulu is the most important commercial, logistic and cultural hub of Arctic Europe. It is a region of over 250,000 inhabitants that is best known for its technological expertise, that makes it a globally significant center in the Europe. Two universities, young population and year-round events makes Oulu vibrant. As a university city Oulu attracts tens of big international conferences yearly. Oulu Region has grown fastest from the Nordic city regions, during last 20 years. The Oulu region population has increased by approximately 9.5% during past ten years, which is the relatively largest in comparison regions (Source: Statistics Finland). Considering Oulu's availability of skilled workforce, status as a hightech hotspot, excellent connectivity and increasing population, the city has an extremely positive future

outlook. The growth is accelerated by the spectacular increase in business in the region. The fifteen most recent companies to have established themselves in Oulu have invested more than â‚Ź100 million in the region annually. The region is also a great hub for investments in Northern Europe totalling â‚Ź200 billion in the coming ten years. Oulu is the biggest year round travel city in North Finland. Here the business and leisure travellers meet green environment, modern city and norhern hospitality. Of the total hotel overnights 55% comes from leisure and 45% from business visitors. Stable growth in tourism makes Oulu attractive for the hospitality business and investments. Occupancy rate in all accommodation has been over 60% yearly in last five years. With this guide, we wish to provide you with an overview of the possibilities Oulu has to offer for commercial real estate investors.

4


Oulu

Commercial Investment Guide 2020

250,000 inhabitants in the area

5

No 1 in quality of life

Source: European commission, Quality of Life in European Cities 2015.


Oulu

1

38

average age of the population

Commercial Investment Guide 2020

Market Area Analysis

23,000 university students

6


Oulu

1.1

Commercial Investment Guide 2020

Market Area Analysis

7

Oulu in Brief

Oulu is an easily accessible city in Northern Finland by the Bothnian Bay. There are over 200,000 inhabitants in the city and 250,000 in the Oulu region. Oulu has one of the youngest populations in Europe: the largest age group is 20- to 24-year-olds and the average age of inhabitants is 38 years. In addition, 23,000 of the

population are university students. This vibrant city with a variety of events and activities all year round is an excellent destination for both business and leisure travel as well as conferences. Oulu is also an excellent base from which to explore the surrounding tourism centres and Lapland.

Why invest in Oulu

1

Location: Being the biggest commercial, logistic and cultural hub in Arctic Europe, Oulu is often referred to as the capital of Northern Scandinavia.

2

Travel destination: Oulu is the biggest year-round travel destination in Northern Finland.

3

Hospitality performance: Oulu has a good record of long-term performance development in hospitality KPIs, such as occupancy, average daily rate and RevPAR.

4

Potential and opportunities: The demand for new hotel capacity is increasing in Oulu. A limited number of new concept offerings and international hotel brand presence means more opportunities.

5

Stability: Finland provides an economically and politically stable environment for business. The hotel market provides stability for longterm commitment and income generation, and potentially higher returns and yield levels than other property types.


Oulu

Commercial Investment Guide 2020

There are 6 times more jobs in ICT industries in Oulu region compared to the same industry in the whole country. Measured with Balassa-Hoover index 2018

3rd

most venture capital in Europe per capita

No 1

in R&D investments per capita in Finland

8


Oulu

1.2

Commercial Investment Guide 2020

9

Market Area Analysis

Economic Structure Oulu is 15th in attracting venture capital per capita among the top 50 cities in the world. Robust ICT expertise has created a unique foundation for innovation and business in Oulu. Between the years 2014–2016, over 500 high tech start-up companies were born in Oulu, and the amount of rented business premises has more than doubled in the past few years. During the past decade, Oulu has attracted dozens of foreign companies especially related to technology research and development. The emphasis of Oulu region’s economic structure is on services. Information technology services, other technology sectors, social and health services as well as education

are regarded as specialities of the region. The share of industrial jobs is lower than in the whole country on average, standing currently at about 13% of all jobs. Oulu is specialised in electronics manufacturing, and the services supporting it for example engineering, software and information services. In addition, consumer potential is growing, as the amount of wage income tax has increased the most (+3.5%) of all Finnish cities. The population of the region will continue to grow. Population growth and the consequent increase in retail purchasing power creates a wide range of opportunities for commercial development and new investments in Oulu and the Oulu region.

Structure of Industries in Oulu region Public admin. and services

25,3%

Services

30,9%

Industries

13,4%

Logistics

5,4%

Commerce

9,9%

Construction

10,4%

Agriculture, forestry and mining

1,5%

Hospitality and catering

3,2%

Source: Statistics Finland, 2018


investment in the Oulu region. However, the most important driver of purchasing power has been the population growth in the Oulu region, which has been the fastest in Nordic city regions. Recently made survey about retail purchasing power (Ramboll 2019) estimated in neutral scenario that purchasing power in the Oulu region will continue to grow by about 25% between 2018–2030.

Population forecast City of Oulu 225 000 220 000 215 000 210 000

2039

Source: Statistics Finland

Households' disposable income Oulu

Turku

Tampere

Jyväskylä

40,000 39,000 38,000 37,000 36,000 35,000

2010

2011

Source: Statistics Finland 2019

2012

2013

2014

2015

2016

2017

2040

2037

2038

2035

2036

2034

2032

2033

2031

2030

2029

2028

2027

2025

2026

2023

2024

205 000 2021

of work-aged population have an academic degree

Oulu is a university city and a city of high level of R&D expertise. Relatively high salary levels and many success stories have brought prosperity to the city. At the same time, Oulu has become a commercial hub for the entire Arctic Europe region, attracting customers from a wide area. Despite general economic fluctuations, purchasing power in the area has grown steadily and has created a good basis for commercial

2022

40%

10

Purchasing Power

2019

1.3

Commercial Investment Guide 2020

2020

Oulu


Oulu

Commercial Investment Guide 2020

11

Market Area Analysis

Population by gender

50/50 Men / Women

Purchasing power per capita and per dwelling in comparison regions in 2018 per resident

per dwelling

16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

Oulu Source: Statistics Finland 2019

Turku

Tampere

Jyväskylä


Oulu

1.4

Commercial Investment Guide 2020

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Accessibility

The gateway to Arctic Europe Located by the sea, Oulu is a junction for sea, railroad and road traffic. Together with Finland's second busiest airport and largest general port in the Bothnian Bay, makes Oulu the most important transport hub for both passengers and freight in Arctic Europe. Oulu is easily accessible by plane and train. There are 15 daily flights from Helsinki and around ten train connections from Helsinki. All trains to and from Lapland make a stop in Oulu. Oulu’s accessibility will be further improved in coming years with

development projects in Oulu’s railway and bus stations and the port of Oulu. There have also been plans to make the railway connection from Oulu to Helsinki faster by developing the rail network and accessibility to and from the port of Oulu. The train connection from Helsinki to Oulu currently takes just over five hours and will be even faster in the 2020's. Oulu is the gateway to Arctic Europe regions, which will see more than 200 billion euros invested over the following decade. By 2030, the number will be 277 billion euros. The largest investments will be made in construction, energy, mining, logistics, tourism and creative industries.

3,270 Electricity transfer grid network 1,755 Bioenergy

200

5,211 Tourism 6,384 Public investments

43,573 Wind energy

7,720 Hydroenergy 10,302 Industry

16,000 Nuclear energy

BILLION EUROS

investments in Arctic Europe 2015–2025

MEUR

1,578 Trade

27,510 Mining

35 B€ TOTAL 41,950 Oil and gas

31,569 Transport infrastructure


Oulu

Commercial Investment Guide 2020

Stockholm 2:45 h

13

Market Area Analysis

Oulu Helsinki 0:55 h

London 3:55 h Paris 3:55 h

New York 12:50 h

Tokio 12:15 h

1h

one hour's flight to Helsinki Arrow-Right Up to 15 departures per day

2

nd

busiest airport in Finland


Oulu

1

st

Finland is the number one country to travel in 2019 Source: Business Insider

Commercial Investment Guide 2020

50

international conferences yearly

14

3 000 total number of events yearly


Oulu

1.5

Commercial Investment Guide 2020

15

Market Area Analysis

Tourism, Leisure Activity & Conferences

A city of year-round experiences Oulu is an extraordinary city from the perspective of travel & tourism. The city has a lot to offer for both business and leisure travellers, from attractions, activities and festivals to exotic arctic nature experiences all year round. Oulu region is a diverse nature destination. Within easy reach from the city of Oulu, you can find ski resorts, national parks and more. Oulu offers a variety of possibilities for day trips and connections to different tourist centres and Lapland.

Finland's leading destination for educational and technical visits In Oulu you can explore world famous Finnish education system from elementary school to university level. There is a wide variety of educational visit programs both for education professionals and school excursion groups, for example on themes such as computer programming, sustainable development and learning English.

2,5 hours

Surrounding tourist centres and Lapland Arrow-Right SyĂśte ski resort

and national park, Finland’s southernmost fell area, 1,5 h Arrow-Right Rokua national park and UNESCO Global Geopark, a rare natural environment shaped by the Ice Age, 1 h Arrow-Right Liminka Bay, an internationally renowned, valuable bird habitat for migrating birds, 30 min

Arrow-Right Hailuoto, the largest

island in the Bothnian Bay, 1 h Arrow-Right Ruka Ski resort and national parks, Kuusamo, 2,5 h Arrow-Right Snow Castle and Sampo Ice Breaker, Kemi, 1,5 h Arrow-Right Santa Claus village and Arctic Circle, Rovaniemi, 2,5 h


Oulu

Commercial Investment Guide 2020

City of conferences and thousands of events

to build e.g. a new Station Centre, a sea pool and several hotels in the city centre. New investments appr. â‚Ź100 million are coming to the seaside resort in Nallikari for example amusement park and leisure services.

Oulu hosts around 50 international conferences yearly. Oulu’s strength in conference tourism lies in a strong science community and expertise. Oulu offers versatile facilities for meetings, conferences and exhibitions. There are many different developments that will make Oulu even more attractive for both domestic and foreign tourists alike. For example, there is a construction ongoing for expansion of Oulu exhibition center and plans

16

The cultural scene of Oulu is strong and diverse. Over 3,000 different events in sports, culture or business are organised in Oulu every year and Oulu is known around the world for its original events such as the Air Guitar World Championships and Polar Bear Pitching. Oulu is also bidding to become the European Capital of Culture in 2026.

Biggest yearly event Event

Month

No. of visitors

Lumo Light Festival

November

150,000

Oulu Days

June

90,000

Oulu August Festival

August

60,000

Qstock

July

35,000

Suomipop

July

30,000

Oulu Music Festival

March

13,000

Source: Oulu Marketing

To see & to do in Oulu Nallikari Beach and Holiday Village Ainola Park Science Center Tietomaa

Biggest yearly fairs

Turkansaari Open Air Museum

Event

No. of visitors

Northern Finland Outdoor Life Fair

38,000

Oulu Arts & Crafts Fair

14,500

Oulu Wellness Fair

12,000

Builder Oulu

8,559

American Car Show

6,500

Senior Fair

6,500

Hifi & Tuning Show

5,000

North Industry

4,200

Scandinavian Design Market Oulu

4,000

Home Fair

3,000

Work Fair

2,500

Source: Oulu Marketing

Toripolliisi Statue Market Hall Oulu Cathedral Hupisaaret Park Botanical Garden Northern Ostrobothnia Museum Oulu Museum of Art Oulu Automobile Museum Nallikari Winter Village and Snowfest Vauhtipuisto Amusement Park Northern Photographic Centre & Gallery Oulu City Hall Kierikki Stone Age Centre


Oulu

Commercial Investment Guide 2020

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Oulu

Commercial Investment Guide 2020

18

1.6 Oulu towards the European Capital of Culture 2026! Oulu is preparing the application for the 2026 European Capital of Culture which aims for a broad, long-term urban development with a project budget of 50 million Euros.

Credits: Lahdelma & Mahlamäki architects, Architects M3


Oulu

Commercial Investment Guide 2020

Future Development Areas Oulu’s City Centre Vision 2040 has ambitious goals for significant development of the city centre in the near future. The plans include large projects that would help the city to attract mega events and increase tourism. Some significant city centre development projects, e.g. underground parking facility Kivisydän and Valkea Shopping Centre, have already been finished. However, they are just the tip of the iceberg. Still, hundreds of millions of euros in investments, such as the Station Centre and several hotels, are yet to be realised. There are also several other areas of development that produce viable investment opportunities.

Museum and Science Centre Luuppi Museum and Science Centre Luuppi is a unique combination of history, art and science. Stories of life in the North, collected and cherished by Luuppi, unfold to the audience through history, science and art. Luuppi consists of nine destinations loved by tourists and locals alike. The Historical Museum, Oulu Museum of Art, and Tietomaa Science Centre are located near the city centre. The

annual amount of visitors is over 200,000. Luuppi is working on new development plans to increase the number of visitors to 250,000 by 2026.

Oulu sea city development plan Located right next to Oulu City Centre is the estuary of Oulu River. With its waterways, islands and parks, it is one of the most important destinations for development in the coming years. One of the islands is Kuusisaari, the venue for large outdoor events and mega festivals for as many as 40,000 attendees every summer. The surroundings and islands of Oulu River estuary are developed as a location for urban events around the year. Another goal is to increase the selection of tourist services in the area and make the existing area appealing also in view of tourism. Pikisaari island is one of two big islands in the estuary, right opposite the city centre. The district is protected and part of a popular island route for pedestrians and bikers. A handicraft training centre in Pikisaari is being developed as a hub for services and experiences in culture and arts.

19


Oulu

Commercial Investment Guide 2020

20

Oulu Area development projects Airport Port Railway Credits: UKI Architects, Lukkaroinen Architects, Tähti-Set Architects

1

FUTURE HOSPITAL 2030 Oulu University Hospital (OYS) is an innovative, research and developmentoriented provider of high quality health care. In the next two decades, the hospital will go through complete modernisation of its functions and premises. The Future Hospital OYS 2030 programme is an extensive operational renewal programme, which will secure the position of OYS as a national and international top provider of specialised health care. The renewal programme is divided into partial projects which are intended to be realised consecutively in order to disrupt the operations of the hospital as little as possible. The objective is to realise the renewal of the entire hospital within about 15 years. Total project size is around 1.6 Billion Euros.

Credits: Sitowise, Graphroot

4

LINNANMAA 2030 Linnanmaa is a diverse campus of ​​ high technology, research, product development and education. Located along Highway 4, Linnanmaa is very accessible. The current business portfolio focuses on ICT, research and trade. The University of Oulu will be joined by the University of Applied Sciences, which is also moving to Linnanmaa in 2020. As a whole, the university campus will then host 23,000 students. Development in the area includes both public investments to educational and public services premises as well as private investments to residential and business premises.

Potential new hotel development areas

8

9 Credits: Linja Architects

Credits: Lahdelma & Mahlamäki architects, Architects M3

2

OULU STATION CENTRE 2025 – MODERN & VERSATILE STATION ZONE The City of Oulu, in co-operation with Senate Properties, VR Group and Finnish Transport Agency, are pre-planning a project for the current railway and bus station and the surrounding zone. Station Centre will be a functional and versatile whole where transport, jobs, services, and accommodation come together. It will also unify the traditional building base of Raksila district and the well-defined city centre grid plan identity. The size of the investment will be approx. 450–500 million euros and total building area around 150,000 m2.

5

RAKSILA AREA One of the City's growth project Raksila includes new hyper market area and housing and offices. Total floor area consists of commercial space 25,000 sqm and housing 20,000 sqm. Part of Raksila area development is Ouluhalli sports arena expansion that will provide official competition fields for the highest league levels of different sports and it will act as a venue for large fairs and other events for thousands of participants. Total floor area of Ouluhall with the expansion will be almost 20,000 sqm.

Credits: Linja Architects

Credits: MUUAN Design Agency, Nomaji Landscape Architects

3

HOUSING FAIR 2025 The annual housing fair will be held in Oulu in 2025. The fair area is situated in a district known as Hartaanselänranta, which is located on both sides of the mouth of Toppilansalmi strait. The Hartaanselänranta Housing Fair is expected to showcase the future of urban living – a high-quality, healthy and stimulating urban environment that promotes community spirit in the area. The shore area of ​​ Hartaanselkä is 25 hectares. The competition will allocate between 70,000 and 90,000 square metres of new construction to the area, consisting mainly of residential construction.

6

OULUNPORTTI DISTRICT Oulunportti has a prominent location near the centre and Oulu Airport. The motorway provides fast connections. Oulunportti can accommodate specialty retail premises that require a lot of space, as well as other specialty goods retail premises that are suitable outside the city centre About 20 new business plots are coming to the area. Overall, 89,700 square metres of floor area have been allocated for building rights and about 500 new jobs will be created in Oulunportti.


Oulu

Commercial Investment Guide 2020

21

4

Credits: Töölö Urban, OOPEAA

7

SEASIDE AND MARKET SQUARE AREA Development of the market square area includes two hotels: the so-called “market square hotel” is under construction and hotel Terwa Tower has been planned on the waterfront by the market square behind the library; it will feature 22 floors. Allas Sea Pool Oulu will be built on Kiikeli Island adjacent to Oulu Market Square and next to the tower hotel. The plan includes a sauna world, restaurant, and heated pools by the sea in the heart of Oulu. In addition, culturally valuable, 110-year-old Market Hall is being renovated by the city of Oulu.

3

7

2

5

1

Credits: Linja Architects

8

NALLIKARI 2020 HIGH-QUALITY SEASIDE RESORT Nallikari resort has superb possibilities for developing and diversifying tourism, training and education, sports, leisure and recreational facilities. The resort’s attractiveness and competitiveness in tourism will also be improved by supplementing available services with new functions, and by ensuring effortless accessibility with different modes of transport. Nallikari has a beautiful seaside location, 3 kilometres from the city centre, with a beach, a wide range of outdoor, restaurant and recreational services, and a variety of events around the year, e.g. Nallikari Winter Village. The Nallikari area is 95 hectares with a total building area of 75,000 m2. Investment opportunity is approx. 100 million euros including hotel, themed amusement park, holiday villas, theatre, restaurants and other services.

6 Credits: Ramboll

9 2 km

ORITKARI LOGISTICS AREA Oulu is one of the most important nodal points of logistics in the northernmost Europe. Oritkari logistics area has excellent connections and accessibility from the main road and railway network. It has the largest general port of Bothnia Bay. The Port of Oulu and Oritkari logistics area provides a gateway to the northern areas of Finland, Sweden and Norway, and northwest Russia. The combined transport terminal is also located close to the port area. The development of the deep-water route was completed at the end of 2018, and the new 12.5-metre shipping route is expected to boost logistics development in Oulu.


Oulu

2

Commercial Investment Guide 2020

Office Space and Business Premise Market

7million visitors in Valkea Shopping Centre in 2018

22


Oulu

Commercial Investment Guide 2020

2.1

23

Market Description Office space market in Oulu has remained active. Newish, attractive, high-quality office premises stay in the demand. The amount of rented offices in Oulu has more than doubled over the last few years after over 500 start-ups were established in 2014–2016 and dozens of new companies located their business in Oulu. Oulu also has a wealth of ideal business premises for companies in the retail and services sector. It is estimated that, by 2030, retail and services will need a lot of new space. The office space market in the city centre is increasingly marked by conflicting demand and supply. There

is demand for good-quality office space. Prime property gross rents are over EUR 20/m2. The rents of the best office properties have gone up slightly in the last couple of years. Population growth in Oulu has also increased the demand for retail space. The City of Oulu has put strong efforts in making the city centre more appealing for citizens, service providers and investors. In the centre, various operators, property owners included, have worked hard to increase appeal. The City of Oulu has also invested in developing parking, public transport, and bringing city bikes to the centre, for example.

Vacancy rates, prime yields and prime rents

tu

tu

en ka

at u

Vacant space, sq. m

27,000

48,000

36,000

Vacancy rate, %

3.8

7.4

2.7

Yield, %

7.25

7.25

9.25

Rents, €/sq. m/month

70

23

8

Source: Catella Property Oy, Spring 2020

nk

tu

tu ka tu

s to Alb

er

tin

ka

ari Sa

Industrial/ Logistics

rie pu up Ka

tu ka en ne uo at u nk rie

at u

ka

Office

City Centre €/sq. m/month

at u

Pa

at u

tu

pu

ak

ink

ika

up

te r

Ka

nt

sik

kk

us llit

To r

Ha Ra

an

Iso

ah

tu

tu

ka

ka

ko

ks

en

ne kk

Pa

at u

ka

ak

nin

As

Ka

em

jaa

uo

at u

Uu

Kir k

Ale

at i

ka

llit ink

ut

ah

l in

Ha

ke

tu

us

ka

tu

Ra

Retail

Retail

35–70

Office (old)

11–14

Office (new office/renovated)

22–24

Retail

13–18

Office

10–13

Retail

10–15

Office

10–13

Source: Catella Property Oy, Spring 2020


Oulu

2.2

Commercial Investment Guide 2020

24

Commercial Real Estate Development Lots of development and renovation is happening in the city centre. There is an air of anticipation in the centre after the commercial block Pekuri (former Stockmann) changed owners. The block will become a vibrant hub for entertainment, services and retail in the city centre.

a project spanning 5,500 m2. Located just a few kilometres from the city centre by the main southern thoroughfare, it offers a good setup for leasing. The same site could accommodate another 5,000-square-metre office building in the future.

In the next couple of years, the office market will be significantly affected by the relocation of public services, e.g. Tax Administration will move when construction of a new courthouse begins on Torikatu. Danske Bank relocated to the market square, and the former bank building on the corner of Rotuaari Pedestrian Street will go through complete renovation and will contain total 4,000 sqm for retail and offices.

Pekuri

Technopolis, phase 2

Oulunportti

The expansion of the Technopolis city centre property will be completed in Q1 2020, bringing more options to the market. The amount of new office space is 9,000 m2.

Oulunportti is a major specialty trade area at the intersection of the motorway and the road to the airport. There are numerous existing specialty stores already in the area, such as car dealers and hardware stores. In the new zoning plan, there is 89,700 sqm of building rights planned for the area. Around 500 jobs will be created.

Limingantulli New office space is also being constructed in the Limingantulli district, where Lapti is producing

Commercial block Pekuri changed owners in June 2019. It was bought by special investment fund Trevian Suomi Kiinteistรถt I. Not all vacant spaces will be used by retail in the future, but some will be converted into high-quality office space instead. The block will have over 20,000 sqm retail, service and office space after the renovation.


Oulu

Commercial Investment Guide 2020

25

Credits: Linja Architects

Raksila area

Station Centre Senate Asema-alueet Ltd, in cooperation with the City of Oulu, will organise a design and plot assignment competition for Oulu Station Centre in 2020. The Oulu Station area will be developed into a centre for traffic, events, services and housing that will naturally connect the traditional grid city centre and the developing Raksila area. The area is extensive and centrally located. This is an interesting and very large-scale renewal project by Finnish standards. This could be compared, for example,

to the development and construction of Central Pasila in Helsinki. The estimated size of investment is 450–500M€.

Raksila area Raksila is a traditional hypermarket area, completed in 1976. One of the City's growth projects is Raksila district that includes renewing the hyper market area as well as new housing and offices. All Together the area includes around 60,000 m2 with commercial space 25,000 m2 and housing 20,000 m2.

Oritkari Significant logistics investments are expected in the Takalaanila and Oritkari districts in the near future. Partnera has announced plans to construct a logistics centre across 10,000–15,000 m2 in the Oulu harbour. The site supply in Oritkari will improve when the Poikkimaantie road is rerouted and the new land area will become available for construction.


Oulu

3

Commercial Investment Guide 2020

26

Hotel Market

644,000 3,386

overnight stays in 2019

beds and 1,589 hotel rooms


Oulu

3.1

Commercial Investment Guide 2020

27

Market Description The hotel occupancy rate in Oulu is officially the highest in the country and new capacity is required to meet the growing needs of the visitors. The average annual occupancy rate of all Oulu accommodation establishments has been over 60% since 2015. The occupancy rates of the eight largest hotels in Oulu have averaged over 65% annually in recent years. That is higher than in Tampere, Turku, Kuopio, Jyväskylä or Rovaniemi.

approximately 20% of travellers are international and 80% domestic. Approximately 55% of the overnights in Oulu come from leisure travellers and 45% from business travellers. Peak season for leisure travellers is July-August, while the business traveller season is year-round. In wintertime, Oulu has big potential for leisure tourism and this aspect is currently being developed.

Travel to Oulu is evenly distributed throughout the year, and

KPI performance in city hotels in oulu RevPar €

ADR €*

OCC %

€ 120

% 70 69

100

68 67

80

66 65

60

64 40

63 62

20

61 0

2014

2015

Source: Statistics Finland, 2020

2016

2017

2018

2019

(*includes VAT 10%)

60


Oulu

Commercial Investment Guide 2020

28

3.1

Market Description

Hotel

No. of Rooms

No. of beds

Radisson Blu Hotel Oulu

235

620

Original Sokos Hotel Arina

152

259

Lapland Hotels Oulu

160

320

Scandic Oulu City

214

532

Scandic Oulu Station

207

527

Break Sokos Hotel Eden

170

340

Forenom Aparthotel Oulu

119

234

Best Western Hotel Apollo

70

124

Lasaretti Hotel

49

118

Samantta Hotel & Restaurant

41

96

De Gamlas Hem Hotel & Restaurant

16

32

KierikinHovi

16

40

Total

1,556

3,607

Source: Oulu Marketing, 2019

In recent years, the average RevPAR (Revenue Per Available Room) of all Oulu accommodation establishments has been 60–70 euros, at least at or above the level of Tampere and higher than in Turku, Jyväskylä or Kuopio. The RevPAR of the largest hotels in Oulu in 2019 was over EUR 74.

RevPar comparison Oulu

Turku

Tampere

Jyväskylä

Kuopio

80

60

40

20

0

2016 Source: Statistics Finland, 2020

2017

2018

2019 (All rates exclude VAT)


Oulu

Commercial Investment Guide 2020

29

Credits: JK Architects

Terwa Tower – Seaside Hotel

Occupancy rate comparison Oulu

Turku

Tampere

Jyväskylä

Kuopio

80

60

40

20

0

2016 Source: Statistics Finland, 2020

2017

2018

2019


Oulu

3.2

Commercial Investment Guide 2020

30

Demand and Supply Oulu is a great place for tourism business. Seasonal fluctuations are moderate and demand is high throughout the year. Hotel occupancy rates and prices have been at the level of the best cities in Finland for the past five years. The city's business growth and international activities provide a solid foundation for continued growth in business travel. Leisure tourists' growing interest in tourist

destinations in the North brings growth to Oulu, for example from Asia and Central Europe. Tourism in Oulu is also strongly based on the demand of domestic tourists. Oulu is also a city of thousands of different events. Oulu and its neighbouring destination marketing organisations market the Oulu region through Visit Oulu cooperation. Oulu region with its surrounding tourism resorts has in total over 1 million overnights yearly.

Domestic vs. foreign guest nights, hotels in Oulu Domestic quest

Foreign guest

600,000

500,000

400,000

300,000

200,000

100,000

0

2014

2015

Source: Statistics Finland, 2020

2016

2017

2018

2019


Oulu

Commercial Investment Guide 2020

Guest nights by travel purpose

31

Overnights by country

Sweden Norway Germany Russia

Business 49.5 %

Leisure 50.5 %

Estonia United States United Kingdom China France

Source: Statistics Finland, 2020

Source: Statistics Finland, 2020

Netherlands


Oulu

3.3 Oulun Saarisampo

Commercial Investment Guide 2020

Future Hotel Developments The main hotel development areas in Oulu are in the city centre and the Market Square area, the station area and the Nallikari Tourist Centre about 3 km from the city centre.

Terwa Tower – Seaside Hotel

Credits: PAVE Architects

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Terwa Management Oy has received a design reservation for a building site owned by the City of Oulu, located at a superior building site in the vicinity of Oulu Theatre and the City Library next to the seaside. Intention is to build an 80-metre-tall building with 22 terrestrial floors. The building is called Terwa Tower and is designed to host a hotel, offices, a restaurant and conference rooms, co-working facilities, and privately owned City Suite apartments plus a spa section with a seawater pool. A meeting place is planned for the top floor with stunning views across the city and the sea. Parking is planned under the building and the market square. Total floor space is 24,000 sqm, with 250 hotel rooms and around 100 city suites. Investment opportunity of approx. â‚Ź100 million.

Maikkula Mansion Maikkula Mansion, located just a 10-minute ride from the city centre, is full of interesting history of Oulu region by the banks of Oulu River. The history of the estate reaches

back to the 17th century. Several differently sized historical facilities on the grounds can accommodate groups up to 550 persons. The present facilities host more than 300 meetings, events, weddings and other unforgettable experiences annually. A new city plan allows investment opportunity to develop the facilities and services to attract more customers, including an estate hotel, with approx. 60 double rooms (2,100 sqm), a holiday village with 16 lodging villas (4,200 sqm), and additional service buildings and premises. Total development area is 14 hectares.

Market Square Hotel Oulu Market Square Hotel and a covered winter market have been designed next to the 110-year-old Market Hall. The hotel is planned to have four floors and 130 hotel rooms. The covered winter market space will serve year-round market activities and provide a sheltered space for a variety of events during the winter.

Airport Hotel Oulu airport is the second busiest airport in Finland and, it being a gathering airport, the hotel will allow long-distance travellers to stay nearby in case a flight departs early in the morning. According to Primehotels, the hotel is now being transformed into one of the


Oulu

Commercial Investment Guide 2020

Saaristonkatu hotel and office tower

international Marriott's Moxy chain hotels. Oulu Airport Hotel will be built just opposite Oulu Airport. The hotel will have eight floors above ground and a restaurant, with 175 rooms and direct access from the Airport.

Nokkala School Hotel In the near future, the Nokkala Old School will be transformed into a highclass hotel, with two new buildings next to the 100-year-old building. The hotel will be small boutique styled hotel about 30 rooms.

Co-Op Oulun Saarisampo Saarisampo is a commercial building in the city center of Oulu. The building will be developed into a hotel or a hybrid property. Isokatu 35 is located right in the city center. Connections

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Credits: Aihio Architects

to the airport and railway station are less than 100 meters away.

Saaristonkatu hotel and office tower

There is an ongoing alteration of plan process concerning Saarisampo and it will be approved in the end of 2020. The future scenario is to build a new 14 to 16-storey hotel or a hybrid building including commercial services such as restaurants. The volume of the building would increase to even 5,000–7,000 m² depending on functions.

Oulun Osuuspankki has initiated a town plan change in the heart of Oulu at Saaristonkatu 8. The purpose is to create a 24-storey office and hotel building on the site. A view restaurant is planned on the top floor. Total of 17,000 m2.

The hotel or hybrid building would activate the city center and respond to the need of hotel services. In the hotel version there would be 160–190 rooms, a restaurant and a 7th floor roof terrace for the customers. The hybrid version combines an 80 to 100-room hotel and apartments.


Oulu

Commercial Investment Guide 2020

34

Oulu – Capital of Northern Scandinavia – growth and development hotspot of Northern Europe.

DISCLAIMER  This document has been prepared to assist prospective investors in making their own preliminary evaluation of investing in Oulu region and does not purport to contain all the information which a prospective investor may desire. In all cases, prospective investors should conduct their own investigation and analysis of any market of interest. None of the producers or financiers of this document provide any guarantee of the accuracy or completeness of the information contained in this document, including forecasts and market data.


Oulu

Commercial Investment Guide 2020

35

Contact information

We are happy to help you discover the Oulu area commercial opportunities and provide you with the right contacts and market information. Jyrki Kemppainen Key Account Director, Trade & Services, Travel and Logistics +358 44 499 3296 jyrki.kemppainen@businessoulu.com Janne Ylitalo Service manager, Investments +358 400 999 523 janne.ylitalo@businessoulu.com Seija Haapalainen Senior Consultant, Relocation Services +358 50 361 4791 seija.haapalainen@businessoulu.com

BusinessOulu P.O. Box 22, FI-90015 City of Oulu, FINLAND Hallituskatu 36 A, 90100 Oulu, FINLAND info@businessoulu.com oulu.com investinoulu.com businessoulu.com

BusinessOulu is in charge of implementing the City of Oulu's industry policies, and providing growth companies with the services they require, in addition to promoting export, import, investments, and employment. With the help of its international partner network, BusinessOulu acts as a partner to companies and helps them grow. BusinessOulu persistently develops tourism business, conferences, congresses and events. Oulu’s innovation environment, ecosystems, and think tanks

create innovations in a bold and productive manner. The aim is to rapidly develop business opportunities and significantly increase startup investments. BusinessOulu offers a large range of services to investors and companies considering expanding their business operations to Oulu. If you are interested to set up and locate your business in Oulu, we will provide you with customized services for free. You will get information on business

opportunities, public financing, working force, potential partners etc. We will help you in every stage of setting up a business. BusinessOulu services cover every stage of setting up a business in Oulu, ranging from initial data collection and opportunity analysis to networking and the actual business launch. Our services are based on full confidentiality and they are totally free of charge.


Profile for BusinessOulu

Oulu Commercial Investment Guide 2020  

Explore the commercial opportunities in the Oulu Area, Finland.

Oulu Commercial Investment Guide 2020  

Explore the commercial opportunities in the Oulu Area, Finland.

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