IHG signs first Iceland hotel: Candlewood Suites Reykjavik
IHG Hotels & Resorts has signed Candlewood Suites Reykjavik, marking the company's first property in Iceland and a new foothold for its Nordic growth strategy. The 53-key conversion sits in Reykjavík's Hlíðar district near Laugavegur, with studio and apartment-style units geared to extended stays. Under a wider agreement with ALVA Capital, IHG plans up to 500 rooms across Reykjavík or elsewhere in Iceland over the next three to five years, with additional brands such as Holiday Inn Express and Garner expected to follow.
Key points
- Why it matters: IHG adds Iceland, expanding Nordic reach with an extended-stay focus.
- Travel impact: Apartment-style rooms and kitchens suit week-plus itineraries and remote work.
- What's next: Further IHG signings in Iceland under a 500-room, multi-brand development plan.
- 53 keys in a central Reykjavík conversion near major attractions.
- Candlewood joins a Nordic portfolio that includes Sweden, Denmark, and Finland.
Snapshot
The new Candlewood Suites will occupy a converted office building in central Reykjavík, steps from Kjarvalsstaðir Art Gallery, the Icelandic Phallological Museum, and Sundhöllin Public Baths. Studios and apartments will feature kitchens, a work area, and seating, with access to self-service laundry, a small fitness offering, weekly housekeeping, and the 24/7 Candlewood Cupboard market. For travelers, the format bridges the gap between a serviced apartment and a traditional hotel, useful in a city where nightly rates run high and stays often extend beyond a weekend. Keflavík International Airport (KEF) anchors most international arrivals about 45 minutes away, and the property's location favors car-free visits centered on Reykjavík's pedestrian core.
Background
IHG has been rebuilding its Nordic presence, reopening in Sweden in 2024 with voco Stockholm, Kista, and maintaining flags such as Crowne Plaza Copenhagen Towers and Hotel Indigo Helsinki. The Reykjavík announcement brings IHG's open and pipeline count in the Nordics to a baker's dozen, while aligning with the region's steady demand for apartment-style lodging. Iceland's tourism rebound adds a supportive backdrop; the Icelandic Tourist Board reported just under 2.3 million foreign overnight visitors in 2024, outpacing the nation's roughly 400,000 residents by more than five to one. Candlewood Suites, acquired by IHG in 2004, now includes more than 400 open hotels and nearly 200 in the pipeline worldwide as of June 30, 2025.
Latest developments
Extended-stay push underpins IHG's Nordic strategy
The ALVA Capital framework contemplates up to 500 rooms across Reykjavík or the broader market over three to five years, signaling a conversion-friendly, value-driven approach for Iceland. Beyond Candlewood Suites, IHG indicates that select-service growth via Holiday Inn Express and its newer midscale brand Garner can complement Reykjavík's strong leisure draw and rising corporate project work. For travelers planning shoulder-season trips, extended-stay formats help manage costs on longer itineraries, a theme we have tracked in IHG's global ramp-up and recent brand milestones. Related context: IHG's estate surpassed one million rooms globally this summer, and Reykjavík remains among Europe's pricier city breaks for Americans, trends that favor kitchen-equipped stays and loyalty-led savings. See our coverage of IHG's room milestone and Iceland trip costs for deeper traveler takeaways: IHG Hits One Million Hotel Rooms Worldwide, Iceland Tops 2025 List of Costliest Vacations for U.S. Travelers.
Analysis
IHG's Iceland entry checks several boxes at once. First, it fills a geographic gap in a region where brand-name extended-stay choices remain limited relative to demand spikes around festivals, fly-drive road trips, and increasingly, remote-work sojourns. Second, a 53-key conversion should move quickly to market, building brand awareness ahead of any larger newbuilds. Third, pairing Candlewood with future Holiday Inn Express or Garner signings creates a price ladder that can blunt Reykjavík's high-season rates, while keeping owners' capital outlays in check.
For travelers, apartment-style amenities reduce dining costs and improve flexibility, particularly on weeklong itineraries that mix Reykjavík with South Coast day trips. Proximity to pedestrian shopping streets and municipal pools supports car-light stays, and weekly housekeeping fits longer visits without daily disruption. The main risk is rate pressure; Reykjavík remains expensive, and small key counts limit inventory in peak months. Still, the extended-stay pivot aligns with Iceland's durable visitation and gives IHG One Rewards members a new earn-and-burn option in a city where points redemptions can offer real value.
Final thoughts
IHG's Nordic momentum gains a high-visibility anchor with Candlewood Suites Reykjavik. The compact, conversion-led start should scale through the ALVA partnership, with additional midscale brands likely to follow as Iceland's visitor base grows. For travelers planning longer itineraries, the kitchen-equipped format offers cost control, comfort, and loyalty leverage in one of Europe's priciest capitals. Watch for opening timing and rates as the conversion nears completion, then compare point redemptions against cash prices to maximize value at Candlewood Suites Reykjavik.