Business
Hotel Industry Thriving in Sub-Saharan Africa
Recent hotel developments in Africa indicate a divergence in activity as international firms move into the continent. According to Lagos-based consultancy W Hospitality Group’s 2013 survey, international and retail chains are signing more deals in sub-Saharan Africa than in North Africa.
Trevor Ward, managing director of W Hospitality Group, stated, “We’ve been doing the survey for six years now and in previous years it’s always been the five countries of North Africa where the most development deals have been signed, but this year the tables have turned from being more North Africa.”
He then advised, “We’re now seeing 140 hotels where deals have been signed with international chains and sub-Saharan Africa. About half that number signed in the five countries of North Africa, so the big story is that sub-Saharan Africa is coming into its own. We think it’s the hotel growth story of the 21st century.”
Ward added that the divergent trend is partly fueled by the mass unrest in the Northern region of the continent in the past few years, particularly in Egypt and Libya. “In Egypt, people are just not signing new deals there anymore, and the tourism industry really has taken quite a shock in the last couple of years. The hotel chains are not looking at Egypt very much anymore. On the positive side, they’re looking much more at sub-Saharan Africa. Particularly countries like Nigeria, for their new growth,” Ward explained.
Nigeria tops the list of most hotels currently being built in Africa at 40, followed by Morocco at 29 and Egypt with 15. East and Southern Africa, which normally make the top cut in a number of sectors, has currently fallen behind in this industry. Top 10 hotel chains by number of hotels in sub-Saharan Africa include Accor, Carlson Rezidor, Hilton Worldwide and the Marriot brands.
“What we have seen from our research is that West Africa is where it’s at. International chains and the regional chains are very much focusing on West Africa, particularly Nigeria but also Ghana and Côte d’Ivoire. Nigeria ticks all the boxes: it’s got the size, the population and most importantly it’s got a large number of cities where hotels can be developed,” said Ward.
Where constriction is concerned, however, the ranking order changes significantly. Countries that top the list in terms of pipeline status are Egypt, followed by Nigeria, Morocco, Algeria and Tunisia. Apart from Nigeria, North African countries prove stronger in terms of on-time construction.
