According to the Estonian Convention Bureau (EKB), organizers of dozens of international professional conferences have considered Tallinn in recent years but ultimately chose other destinations. Most of these conferences draw between 1,000 and 3,500 participants, while the largest attract more than 7,000. Together, they represent nearly 60,000 delegates and an estimated €65.5 million.

Nearly all of these conferences have more than 1,000 participants and none of Tallinn's existing venues was suitable for them.

According to consulting firm Gaining Edge, the leading criterion in choosing a destination for an international conference is whether its venues have the capacity and facilities the event requires. The availability of hotels also matters.

Tallinn is ruled out because it lacks the necessary venues. Organizers generally need more than one large room: they also need smaller rooms nearby for working groups, as well as space for exhibitions, networking and catering. These requirements are why the planned large arena would not remove the need for a conference center. Estonia needs both.

Tallinn is the only capital in the Nordic and Baltic region without a large, multifunctional conference and exhibition center that meets international standards. Tampere, for example, has a population of 245,000 and hosts nearly 900 events a year. Vilnius' LITEXPO hosts 1,300, while Riga has the ATTA Center.

A conference's significance for hotels

Take an event with 2,000 delegates, each staying an average of four nights. About 85 percent of delegates at international professional conferences arrive from abroad and need a hotel room, though some share with a colleague or companion.

That amounts to 5,900 room nights or about 1,480 rooms each night. In Tallinn's hotel market, which has more than 7,100 rooms, that would occupy 21 percent of the city's total room capacity at once.

Alongside the large conference hotels, midsize and smaller hotels would fill up too. During the low season, those hotels might otherwise be half empty or closed altogether. One such event would generate about €470,000 in room revenue during the low season. Delegates' direct spending in Estonia would total approximately €2.1 million, of which nearly €540,000 would go to taxes.

International professional conferences are planned three to five years in advance and generally avoid the summer months.

Consider what would happen if the Estonian Convention Bureau's forecast proves correct and the center brings Tallinn an additional 18,000 business visitors a year or roughly eight large international conferences. Hotel occupancy would rise by 2.5 percentage points.

Two and a half percentage points may not sound like much, but it means an additional 26,600 room nights in the months when occupancy is lowest. In the hotel business, a few percentage points of winter occupancy often determine whether the year ends in a loss or a profit.

More important still, conference demand enters the market differently from leisure travel demand. During the low season, a hotel usually fills its last rooms by lowering prices. A conference room block, however, comes at a contracted rate that is generally higher than what the hotel would otherwise charge for a room in January.

Conferences are also known about well in advance. A leisure traveler books two weeks ahead; a large international conference books two to five years ahead. A hotel that knows two large conferences are coming to the city in February the year after next can plan staffing, renovations and pricing very differently from one that faces each winter with uncertainty.

Labor and investment capacity

That brings us to two problems the accommodation sector has complained about for years, both directly fueled by seasonality.

The first is staffing. Estonia's long-term tourism strategy identifies staff turnover caused by seasonality as one of the main obstacles facing accommodation and food service businesses. It sets a goal of raising the sector's value added per employee from €21,839 to €48,000. More consistent demand throughout the year is essential to reaching that goal: it allows businesses to retain permanent staff, invest in training and pay competitive wages. A seasonal hotel cannot do that, however much it wants to.

The second is accommodation capacity itself. According to an analysis by Tallinn's Strategic Management Office, the city will need another 1,400 to 2,200 rooms by 2040 to accommodate the projected number of overnight stays. But a new hotel cannot be built on the strength of seasonal demand alone. The return on such an investment is calculated over years, not three months.

Catering and the rest of the city

Conference delegates differ from the average visitor chiefly in how long they stay. An international conference delegate is known to spend about €1,045 per trip in Estonia, compared with €316 for the average foreign tourist, according to the border survey. The difference in daily spending is smaller, but two-thirds of delegates stay for three to six nights and 25 to 40 percent extend their visit for a vacation. The average foreign tourist stays 2.6 nights.

According to the border survey, foreign tourists spend an average of €34 a day on food and drink. Coffee breaks, lunches, receptions and gala dinners paid for by conference organizers come on top of that. EIS (Estonian Business and Innovation Agency — ed.) estimates that local businesses earn more than 40 percent additional revenue while an event is taking place.

Unlike some other types of visitors, conference delegates stay in the city: they sleep in hotels, eat in restaurants, use transportation and shop at local stores. According to EIS, 60 percent of international conference delegates would like to return for a vacation.

Linnahall

The Estonian Convention Bureau considers Tallinn's Linnahall suitably located and believes it could accommodate a main hall with more than 3,000 seats, a modular conference area for more than 7,000 delegates and over 10,000 square meters of exhibition space. Such a venue would also make it possible to host trade fairs, cultural events and other international gatherings that bring guests to the city's hotels and restaurants.

For the center's business model to work, it would need an operator with international expertise that actively attracts events. Nor would a conference center alone solve the seasonality of Estonia's tourism industry. Tallinn is in a region through which approximately 2,750 international conferences and trade fairs with 500 to 4,000 delegates rotate each year, so the demand already exists.

Estonia's long-term tourism strategy for 2025–2035 lists the availability of a multifunctional conference center as a measure to track. Tallinn accounts for 69 percent of overnight stays by foreign visitors in Estonia, which means Tallinn's low season is also Estonia's low season.

For years, the accommodation and food service sector has been tasked with increasing value added, lengthening visits and reducing seasonality. But those three goals cannot be achieved together without the facilities to host multiday international conferences.

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