LOCAL and international hotel groups are making strides into the rest of the African continent, prompted by rapid African economic growth and an opportunity to accommodate the increasing number of business and leisure travellers in the region.
The industry in South Africa has been hampered by an oversupply of rooms and low occupancy rates, and with local expansion opportunities relatively limited, hotel groups are increasingly looking to undersupplied regions in the rest of Africa.
Protea Hospitality Group CEO Arthur Gillis says the group is "looking at every country in sub-Saharan Africa" for expansion opportunities. The group, which caters mainly for business travel, signed an agreement in July last year for the construction of another hotel in Uganda.
Protea Hospitality is on a $120m African expansion drive, with projects under way in Nigeria, Zambia and Uganda, and sights on "lots of other places".
The group’s African footprint covers South Africa and seven other sub-Saharan Africa countries.
Mr Gillis says the group is focusing "on our own backyard" in sub-Saharan Africa but is "unlikely to expand into a country which is not serviced by South Africa from an air point of view or (not) considered desirable by South Africans".
Meanwhile, Hilton Worldwide intends to accelerate its growth in Africa, and already has 19 properties in the pipeline to add to its 33 hotels on the continent, CEO Chris Nassetta said in September. He says there are "amazing growth opportunities in Africa — we will grow rapidly, there is exceptional opportunity to grow that base".
Andrew McLachlan, Rezidor Hotel Group’s vice-president of business development for Africa and the Indian Ocean Islands, says the group opened four new hotels in sub-Saharan Africa last year, and expects to open three more this year.
"From a growth point of view, we don’t see new hotels being added to the portfolio in South Africa — the market is saturated from a new supply point of view," Mr McLachlan says, adding that incorporating existing hotels into the brand would drive growth in South Africa. "In the rest of Africa, we see opportunity to add new rooms into markets purely because the supply and demand is still out of sync — there’s still great demand and not too much supply," Mr McLachlan says.
Rezidor intends to use its Radisson Blu and Park Inn brands to expand in West and East Africa.
The group had originally hoped to reach 50 African hotels by the end of 2015, "and we will probably do it in the first quarter of 2013 — so we’re ahead of where we wanted to be".
City Lodge Hotels CEO Clifford Ross says City Lodge plans to further expand its operations into the rest of Africa. "The group is continuing its investigations into the African markets identified for this purpose."
The 106-room Town Lodge Gaborone opened its first rooms last month, and will be fully open next month, Mr Ross says.
City Lodge has plans to invest R1.5bn over the next five to 10 years building up to 20 hotels on the continent.
Tsogo Sun Hotels MD Graham Wood said last year that Tsogo’s hotel division was eyeing opportunities to expand its Garden Court and StayEasy brands into African countries beyond SA’s borders over the next five years. "There are opportunities in Africa in the value-for-money segment and we are testing the appetite for budget accommodation with our StayEasy hotel in Lusaka."
Tsogo operates Southern Sun and StayEasy hotels in Mozambique, Tanzania, the Seychelles, Kenya, Zambia, Nigeria and the United Arab Emirates.
Peermont Global CEO Anthony Puttergill says the operator will "continue to investigate hotel and casino projects in Southern Africa".
Besides its South African operations, Peermont also operates three hotels in Botswana.
US-based hotel operator Starwood Hotels & Resorts Worldwide, which has brands including Sheraton and Westin, also has intentions to rapidly grow its presence on the continent.
Starwood has an African portfolio of 38 hotels and plans to open 10 new hotels in the region over the next three years. It plans to almost triple its African presence to 100 hotels by 2020.
Listed tourism group Cullinan Holdings, whose brands include Thompsons Holidays and Pentravel, was appointed by South African Airways (SAA) to develop and operate the SAA Holidays Programme out of SA. Cullinan chairman and acting
CEO Michael Tollman says while the SAA Holidays Programme has been rolled out in South Africa, "most importantly, we are poised to roll it out throughout the rest of Africa".
Source :bdlive.co.za
