I was at the Grand this summer and while it's still the best hotel in Sweden it can be a bit hit-or-miss with some rooms. There's no doubt that the hard product and facilities at Upper House are edging out Grand the way it is now. Which is only natural as everything is pristine at UH. Time will tell if it can go the distance.
I agree that they are both outrageously expensive if you get paid in USD (which has yielded over 20% worth to the SEK the last few years). Clearly the focus is on the upscale business traveller.
However, while Gothenburg might be a 2nd tier city Gothia Towers will be Europe's largest combined hotel and convention center once the third tower is completed. So the hotel is reaching for a far bigger audience than what the city size might let on.