Boom time for hotel industry in Africa

2014-04-27 06:00

South Africa is seventh on a list of African countries ranked according to the number of hotel deals and hotel rooms planned for 2014.

According to the survey of the Lagos-based W Hospitality Group, the number of branded hotel rooms planned for sub-Saharan Africa has risen to 23 283 rooms in 2014 – from 13 700 in 2011. The number of hotel deals increased sharply from 77 hotels in 2011 to 142 hotels in 2014.

The survey is based on contributions from 27 hotel chains with 60 brands between them.

Of these 27 hotel chains, 24 of them are already operating in Africa, with a total of about 84 000 rooms.

This represents almost 50% of the supply of branded hotels.

Nigeria, which recently overtook South Africa as the biggest economy in Africa, ranked first in terms of both the number of hotel deals and the number of rooms that have been planned.

It has 6 614 rooms planned for 2014 and 40 hotels planned for the year.

South Africa was ranked seventh with 1 293 hotel rooms and nine hotels planned for 2014.

Recently, international hotel group Marriott International acquired South African-based Protea Hotel for R2.2 billion as a springboard for expansion into Africa.

Companies such as The Rezidor Hotel have been bullish on Africa and their Radisson Blu brand has grown in the country and in Africa.

Trevor Ward, managing director of W Hospitality, said: “The big story this year is a dramatic surge in interest from the hotel chains in sub-Saharan Africa. The continent generally has never been an easy place to do business, and is likely to remain more challenging than Europe, or even China. However, the lack of quality hotel rooms, not just in the capitals but also in the secondary cities, is so marked that the major international chains now cannot ignore the opportunity.”

The report states that the 49 countries in sub-Saharan Africa have a development line that is over 40% greater than the five countries in North Africa that were surveyed: Egypt, Libya, Morocco, Algeria and Tunisia.

The region continues to be negatively impacted by the unrest in many of its markets, particularly Egypt, where projects have either been cancelled or suspended.

Of the five North African countries, Libya is the top performer in terms of growth, despite the ongoing unrest there.

Jonathan Worsley, who is involved in the Africa Hotel Investment Forum for hotel investors interested in Africa, said things were looking up for Africa.

“There are three trends we are observing in Africa that act like a virtuous circle – cessation of conflict, economic growth and investor confidence – and at present that virtuous circle has very positive momentum.”

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