Narva currently lacks a modern, sleek, well-designed hotel in the price range of €50-70 per night (equivalent to IBIS or Park Hotel). There is coverage on the lower, less expensive segment of the market, meaning worn-down three-star hotels, and the Narva-Jõesuu spas cover the upper segment. The quality class of “modern three-star plus” and price class of €50-70 per night is vacant.
One of the aims of Linda 2 is to fill this gap and become the market leader in this hotel segment (the most popular segment in the world) in Narva, but also in the general region of Eastern Virumaa.
The planned hotel has a sufficient investment threshold to achieve a monopolistic position for at least the following five years. To establish another similar hotel, the occupancy rate of the Linda 2 hotel would have to exceed 70% over several years.
The building can accommodate a 120-145 room capacity hotel with a spacious and practical reception area, including all necessary technical rooms, a massage centre, a restaurant, and a rooftop bar.
The existing 9-storey tower has a superb floor plan for conversion to a hotel, namely the existing concrete structure (concrete pillars at 6-metre intervals and 3.3-metre spaced ceilings) enables the construction of a hotel with very efficient space utilisation for significantly less investment compared to erecting a new building.
As the existing building stands on commercial land, there are also no risks associated with the plot of land or planning. The building is based on Estonian capital, the owner being trustworthy and interested in long-term and well thought-out business.
The Linda 2 hotel would occupy a large part of the existing market, but first and foremost would be the creator of its own market, providing a stable, high-quality and modern partnership for tourism companies and conference organisers, as well as business and holiday tourists.
The organisations within the building will themselves create a need for approximately 3,000-4,000 overnight stays. Assuming an average price of €45 a night and an occupancy rate of 50%, the hotel would expect to see an annual revenue of €1.1 million. This will be supplemented by the revenues of the restaurant and other services and the potential revenue gain in the case of higher average prices and occupancy.
The hotel would set an investment threshold for similar projects, which would logically have to be preceded by several years with an occupancy of 70% or higher.