I was in Accra recently, after an absence of about six months. Boy, that town is booming! Some would say, with justification, that it is creaking at the seams – certainly the traffic has become a real bore, on a par with the notorious Lagos ‘go-slows’. And like Lagos, Accra is seeing an explosion in the number of shops, restaurants and bars opening. The city’s hotels are enjoying the best times ever, with room occupancies of 75% and above, the norm. And that means prices are up, up, up, as the hotels use the yield techniques that we experience when we book a flight – the later you book, or the busier management expect to be, the more expensive it becomes.
Future hotel openings may make the town a bit cheaper, but I wouldn’t bet on it. The Kempinski and the Marriott, both slated to open in 2014, are more than likely going to keep the prices high, after luring us with tempting opening offers!
There’s talk of a lot of new hotels coming into the market, particularly around the airport. The plan is to increase the capacity of Kotoka by building out the terminal down the hill, at the foot of which is to be a hotel ‘strip’, including – according to the 2011 master plan – a Hilton, a Radisson Blu and a Protea, and probably others. Plus, there’s the ‘transit hotel’ next to the existing domestic terminal, rumoured to be a City Lodge.
In Airport City, the scene of immense development activity, there’s plenty going on. As well as the new Marriott, there’s African Sun’s Amber Hotel waiting to open, although it is unable to do so because of a serious lack of furniture!
The new Kempinski is downtown, next to the convention centre, and is part of a much larger development, the Gold Coast City, with retail, residential and offices planned. Management’s plan is to be the best hotel – not only in Accra but in West Africa as a whole – and from what I’ve seen and heard, there’s a good chance of that happening. Apart from 80 rooms on Oxford Street in Osu, there’s nothing else under way downtown that I’m aware of, and with the traffic like it is, and likely to get worse, travellers will continue to choose between the airport and the city centre, depending on where their work or interest is, rather than travel between the two areas.
But, as with so many African markets, don’t place any bets on these new hotels. We can be ‘sure’ the Marriott and Kempinski will open – but when? Both openings are delayed by years, and the dates keep slipping.
And don’t be too sure that prices will come down, either – it’s all about supply and demand. Hotel prices were already rising, and then ‘Big Oil’ hit town. Look at Lagos, where the room supply has increased threefold in the last 10 years, but, because demand has also risen dramatically, the cost of staying in one of the main internationally-branded hotels is now $400 and more. And that’s excluding breakfast at $35 or more a pop!
Room prices in Accra are not there yet, but they’re getting there. What the city needs, in order not to get a reputation of being unaffordable, like Luanda and Lagos, is more hotels at the midmarket and budget level. Ibis have opened at the airport in Lagos, there’s another one on the way in central Ikeja, and both Park Inn by Radisson and Hilton Garden Inn have projects in the same area. So, developers in Lagos are already seeking to exploit that market niche – probably perceiving that the upscale market is getting a bit overcrowded – and it can only be a matter of time before Accra gets in on the act as well. We’ll then have more choice and, if we want to, can vote with our wallets. Or will demand just be so strong that we end up paying $200 or more – plus breakfast – at the Accra Ibis?
Trevor Ward
MD: W Hospitality Group
www.w-hospitalitygroup.com