According to the results of last August, booking systems received additional offers from 301 hotels in Africa for a room stock of 57,011, which is 11% of the total supply of hotels on the continent. This was reported by the analytical company STR Global.
In anticipation of African Investment Forum (AHIF), which will take place on Wednesday, October 11, Thomas Emanuel, Director of Business Development, STR, commented on the current trends, characteristic of the African hotel market at the moment.
"In local currencies across Africa, prices are rising in several countries, including Egypt, Morocco and South Africa. Meanwhile, other markets are already experiencing lower productivity as a result of increased supply, including Nigeria, Ethiopia and Algeria," — the expert emphasized.
Overview of individual hotel markets:
Egypt
As of August 2017, Egypt hotels posted a 70.1% increase in average daily room rate (ADR) ADR). It is worth noting that the devaluation of the Egyptian pound has significantly inflated the figures. If we look at prices in US dollars, from January to August 2017, the ADR in Egypt fell by 17.2%, falling to $66.54.
Thus, Cairo demonstrated an increase in hotel occupancy of 8.5% and an increase in ADR of 72.5% (-16.2% in US dollars), which led to an increase in revenue per available room (RevPAR) of 87.2%.
Although Sharm El Sheikh recorded a 13.9% increase in employment in the first eight months of the year, the actual employment level in the market was only 40.4%. STR analysts note that security concerns continue to hamper hotel demand in Sharm el-Sheikh.
Nigeria
STR analysts expect supply growth to continue to put pressure on Nigeria's employment levels in the near future. August data shows employment falling by 1.2% to 44.3%, but ADR rising by 6.8%. However, when measured in US dollars, the ADR fell by 23.3% to $149.58. The Nigerian market is currently facing several security-related issues as well as difficulties in Lagos due to low oil prices.
Meanwhile, experts believe that Nigerian hotels are the most attractive on the African continent, including for investments.
Nigeria has a good selection to offer the market: 61 hotels (10,113 rooms), of which 21 are well-known brands. “Branded” hotels are currently represented in 9 cities in Nigeria.
It is worth noting that the country's population of almost 192 million people is growing at 2.6% per year, and the local economy is the most "powerful" on the continent, which explains the rapidly growing hotel business.
Ethiopia
Ethiopia had a mixed performance in 2017, with occupancy down 6.7% to 51.6% and ADR down 8.0%. Meanwhile, STR analysts note that the country’s available nights increased 4.2% compared to the first eight months of 2016, which impacted occupancy levels. RevPAR declined 5.4% in August, mainly as a result of lower occupancy.
Rwanda
According to the African Hotel Report 2017, the Rwandan hotel investment market has grown by 8.8% over the past 8 years. For the first time, the republic entered the top ten most attractive countries in Africa from the point of view of the hotel business.
Today, experts call this country "an African beacon for investment", the reason for which is the improvement of the investment climate in the state. In particular, government support in the creation of infrastructure, the reduction of bureaucratic processes to a minimum and the elimination of corruption have allowed foreign investors to feel confident in the future of the country. At this stage, the construction of four new hotels with 544 rooms is planned in the capital of the country, Kigali.
Source: trn-news.ru
