The purpose of this Thesis is to conduct an analysis describing the sustainable strategy available for hotels, evaluating its potential to create competitive advantage and exploring how its implementation influences other actors in the industry specifically and the whole area development generally. The case study of Ørestad district has been chosen with focus on the Crowne Plaza hotel. The Crown Plaza is the first hotel in Ørestad area that has employed the sustainable strategy into its operational activities. According to the analysis, the sustainable efforts of the hotel include environment-friendly technologies, waste management, use of organic materials, organization of social benefits and events for their employees. The conducted interviews with Crowne Plaza’s employees showed the relationship between hotel’s strategy and employees’ satisfaction. Furthermore, the study has explored the ability of sustainable efforts to create unique reputation for the hotel. The latter, in turn, attracts the business customers who consider sustainable hotel as valuable partner for their own reputation. All in all, as the sustainable strategy enhances the profitability, it is considered a source of completive advantage.Despite the benefits of the strategy, the competing hotels are not willing to imitate the concept. Low demand from private guests, variety of alternative options, high risks and investments are main reasons of indifference to sustainability from their side. As a result, this reluctance restricts the sustainable spillover effect and corresponding urban development in the area. However, as the government and construction agencies are interested in “green” trend and the Crowne Plaza is willing to share its practices, the sustainable urban development opportunities are still possible in the future.The recommendations to the Crowne Plaza include providing the tangible evidence of the sustainability in the hotel and continuing the introduction of environmental and social efforts. In turn, other hotels should start employing the sustainability in its strategic activities because the demand for it will only grow in the future. Only when all players in the area will realize the need for a change, the sustainable urban development will be achieved in Ørestad district.