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For much of its history, Helsinki remained a small coastal town, overshadowed by the more thriving trade centers in the Baltic region. The construction of the Sveaborg (In Finnish Viapori, today also Suomenlinna) naval fortress helped improve its status, but it was not until Russia defeated Sweden in the Finnish War and annexed Finland as the autonomous Grand Duchy of Finland in 1809 that Helsinki began to develop into a major city.

In order to reduce Swedish influence Czar Alexander I of Russia moved the capital from Turku, which had close ties to Sweden , to Helsinki. The Royal Academy of Turku, at the time only university in Finland , was relocated to Helsinki in 1827 and eventually became the modern University of Helsinki.

The following decades saw unprecedented growth and development for the city into the modern world class capital it has become in the 20th and 21st centuries. This transformation is highly apparent in the downtown core, which was rebuilt in neoclassical style to resemble St. Petersburg. Technological advancements and industrialization were key factors behind the growth. Renowned architects such as Eliel Saarinen created utopist plans for Helsinki, which were never fully realized.

In the 1918 Finnish Civil War, Helsinki fell to the Red Guard on January 28th, the first day of the war. The Senate was relocated to Vaasa, although some senators and officials remained in hiding in the capital. After the tide of war turned against the Red forces, German troops fighting on the side of the Finnish White Guard recaptured Helsinki in April 1918. Although the civil war left a considerable scar, the standard of living in the country and the city improved in the following decade.

In the aerial bombings of the Winter War (1939-40) and the Continuation War (1941-44) Helsinki was attacked by Soviet bombers. The most intense air raids took place in the spring of 1944, when over two thousand Soviet planes dropped some 16,000 bombs in and around the city. However, due to successful air defense the city was spared from the large-scale destruction that many other cities in Europe under bombings of similar scale suffered. Only a small number of bombs hit populated areas.

Despite the tumultuous first half of the 20th century, Helsinki continued to develop steadily. The rapid urbanization of the 1970s tripled the population in the metropolitan area. During the 1990's Helsinki became one of the fastest growing urban centers in the European Union. The relatively sparse population density of Helsinki and its peculiar structure have often been cited as reasons behind the relative lateness of the urbanization of the city. Today the Helsinki metropolitan area is the second most sparsely populated EU-capital after Brussels.