Growth story of the 21st century

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Africa offers enormous growth potential for the world’s hotel giants, driven by sustained economic growth, rapid urbanisation and infrastructure development. Helen Grange looks at the continent’s rapidly expanding big brand hotel profile.

Ebola, a falling oil price, xenophobia, civil unrest, visa issues … Africa has no shortage of challenges for the tourism trade. Yet despite these obstacles, the continent remains the ‘land of opportunity’ for the world’s big hotel groups.

These hotel groups are increasingly looking to unchartered or undersupplied regions in Africa, and today, no less than 50,000 hotel rooms are in the pipeline for the continent, according to W Hospitality Group’s 2015 ‘Hotel Chain Development Pipelines in Africa’.

Hotel brands contributing to the survey numbered an impressive 80, and of those, 33 chains are contributing to the development pipeline, which includes a total of 270 new hotels.

“Hotel development on the continent is rarely easy, but the recognition that there are opportunities which can, and must, be exploited is firmly rooted. Several of the international hotel chains have established development offices in Africa, the newest being Hyatt in Nairobi,” says Trevor Ward, Managing Director of W Hospitality Group, a Lagos-based consultancy.

Most of this new development, the survey shows, is unfolding in sub-Saharan Africa (almost 70% compared to North Africa), as this region boasts far more country markets than up north (49 countries versus five).

“Also, many of the sub-Saharan markets have historically been underserved by branded hotels and are now playing catch-up. Mauritania, for example, with no existing branded supply, now has three branded hotels in the development pipeline,” notes Ward.

As a sub-region, West Africa is, in fact, leading the pack, with Nigeria out in front ahead of North African countries Egypt and Morocco. Those three countries have occupied the top three slots since 2011. According to the W Hospitality survey, the West African region has by far the largest number of rooms in the pipeline, more than double East Africa, driven of course by Nigeria, officially recognised as the largest economy on the continent in 2014, after it “rebased” its gross domestic product (GDP) data.  

“Nigeria has in its pipeline over 8,500 rooms in 51 planned new hotels, according to the survey, which is more than the entire pipeline in Central Africa and East Africa combined,” says Ward.

Egypt, traditionally a major growth market, took a knock last year due to delays and some of its projects being cancelled. Still, the average size of the new hotels in its pipeline are much larger than in Nigeria.

“Despite the continued difficulties that Egypt has faced, it recorded a 37% increase in its pipeline, indicative of returning confidence. Egypt also has the highest ‘performing’ pipeline in Africa, with almost 5,500 rooms under construction, compared to 3,400 in Nigeria,” says Ward.

Moving south to Kenya and Uganda, there were large increases in their pipelines, albeit from a much smaller base than the leading nations. Hotel development in Southern Africa, meanwhile, continues to lag behind, with fewer rooms in the pipeline this year than in Central Africa, and with the highest number of countries (five) with no activity at all, namely Botswana, Lesotho, Malawi, Swaziland and Zimbabwe.

South Africa is the exception, of course. Cape Town is the popular destination in Southern Africa for new hotel investment, according to South African Tourism, and the city has 11 new hotel projects – providing about 2,102 rooms – in the pipeline, due to open by 2018. Among those projects, Tsogo Sun’s construction of a new 500-room hotel complex in Cape Town’s city centre, at a total investment of $56 million. The new hotel will consist of two products in one complex – a 200-room SunSquare hotel and a 300-room new generation StayEasy hotel. Included in the complex will be banqueting and conference facilities, a Vigour & Verve restaurant, retail space and approximately 300 underground parking bays. The hotel site – previously the Tulip hotel – currently includes a heritage façade which will be retained. Construction is expected to be completed by September 2017.   

Linked to hotel development growth is the increasing number of hotel investment conferences being held in Africa. The African Hotel Investment Forum (AHIF), for example, known for attracting big international players, was held last year in Addis Ababa. It was attended by over 500 delegates from 47 countries, with half of all African countries having some representation, and it was sponsored by over 35 companies – international hotel brands, leading advisory firms, governments, developers and banks.

Africa is the new growth frontier for hotel groups for a number of reasons. The International Monetary Fund predicts that no continent will grow more strongly over the coming years, and estimates that Africa’s GDP will grow between 5% and 5.7% this year. At the core of this growth is Africa’s rising middle class, which is almost as large as the entire populations of Russia and Brazil combined. According to the World Bank, if Africa were a country, it would already be “middle income”. The world’s Middle Income Countries (MICs) are defined as having a per capita gross national income of $1,045 to $12,746.

Africa also has the ‘right kind’ of population growth, with rising longevity and declining birth rates.

“With 70% of its population under 35, Africa will enjoy an extraordinary demographic dividend as their energy and talents drive economic growth and development,” explains Hassan Ahdab, Regional Vice-President, Africa & Indian Ocean at Starwood Hotels & Resorts. Starwood currently has 35 properties across Africa, covering 14 countries and five brands – Sheraton, Four Points by Sheraton, Le Meridien, St. Regis and Westin. Added to this is rapid urbanisation, which lures investors to capital cities and fosters industrialisation across all sectors.

International trade is another dynamic fuelling hotel expansion.    China has become Africa’s biggest trading partner by far, exchanging about $160 billion-worth of goods a year.

“More than one million Chinese, most of them labourers and traders, have moved to the continent in the past decade,” says Ahdab. The discovery of substantial oil reserves in Ghana, Southern Sudan, Gabon and Guinea Equatorial, meanwhile, has enhanced the economy of these countries. “Black gold provides the prospect of reducing debt, investing in infrastructure and achieving sustainable middle-income status,” says Ahdab.

Bullish economies and new oil finds aside, airline capacity in Africa has been steadily increasing, and business travellers are increasingly looking for more choice and better quality of hotels.

“Most importantly in sub-Sahara Africa, the density of quality hotels is very low and there is less supply than demand, driving attractive average rates for stakeholders,” comments Moevenpick Hotels Vice-President Sales & Marketing for Africa, Stephen Banks.

One of these stakeholders is Best Western International, the world’s biggest family hotel group. It is now in 10 African countries with 21 properties, including seven in Nigeria. It recently unveiled its first hotel in Zambia and has big plans going forward.

“All the hotel companies see the potential for growth within the African market. There are vast opportunities for independent hotel owners to use the Best Western International brand to help grow the awareness of their hotel around the world and enjoy the benefits,” comments Karl de Lacy, International Development Director for the group.

Ward says that by now, all of the global players have dealmakers based in sub-Saharan Africa, and the payback is evident from the “growing number of signed branding and management deals”. InterContinental Hotels Group (IHG) is a great example. It’s one of the world’s hotel giants, with 4,700 properties in nearly a hundred countries, yet only recently set up an office in Johannesburg, despite already having nearly 30 properties in eight African countries.

“The growth is certainly currently in sub-Saharan Africa,” says De Lacy. “The transition from North to sub-Saharan started before the significant political changes and movements which have taken place over the past four years, remembering too that the vast majority of the countries in Africa are in sub-Saharan Africa,” he says.

A group such as Four Seasons would probably agree. Until 2014 its African footprint very much focused on North Africa, with properties in Alexandria, Cairo, Marrakech and Sharm El Sheikh, with just its Serengeti, Mauritius and Seychelles properties outside of that. Now the group has a serious foothold in Southern Africa, thanks to its acquisition and refurbishment of the iconic Westcliff Hotel in Johannesburg, which opened at the end of last year as the Four Seasons Hotel Westcliff.

“Four Seasons is very focused on its global development, including in Africa, in both resort and city hotels destinations,” says the hotel’s Director of Sales & Marketing, David Barillot. “As a very selective luxury brand, we can only envision being present in selected cities and resort destinations, but the growth of the sub-continent economies, and global leisure travel trends, has led us to identify a good dozen locations as a priority focus for our development.”

Looking at the continent as a whole, W Hospitality Group’s survey counted a record 79 deals signed in 2014. Between 2006 and 2011, there were 60 deals signed.

“That totals over 35,000 new rooms in 210 new hotels in the next three years, and there will certainly be more than that in deals yet to come,” says Ward.

The big players, and where they are

According to the W Hospitality survey, the African hotel development pipeline race – in terms of  number of branded hotel rooms – is led by Carlson Rezidor’s Radisson Blu brand, followed by Hilton, Marriott, Sheraton (Starwood Hotels’ flagship brand), Hilton Garden Inn, Kempinski, Park Inn by Radisson, Noom (a Mangalis brand), Four Points by Sheraton and Courtyard by Marriot.

Each of the groups represented above is going full throttle ahead, especially in sub-Saharan Africa where the GDP is expected to grow 4.5% for 2015, making it the fastest growing economic zone in the world, even outpacing Asia’s regional average of 4.3% annual growth, according to the Economist Corporate Network.

So who is doing what and where?

Carlson Rezidor has the largest pipeline of hotels in Africa right now. It entered the African market in the year 2000 with its first Radisson Blu in Cape Town, and today has no less than 62 hotels (14,000 rooms) open or under development in 26 countries. It continues to expand its African portfolio at a rapid pace, and recently announced that it would open two Radisson Blu beach resorts in Mauritius, whilst the imminent opening of the Radisson Blu in Nairobi is much anticipated. This, fresh off the back of the announcement in April that Rezidor will open the very first Radisson Red in Europe, the Middle East and Africa in Cape Town in late 2016. The Radisson Red Hotel will be located at the V&A Waterfront and will feature offers and services such as flexible, functional guest rooms, paperless check-in, and a 24/7 deli and bar.

“By 2020 we hope to have 120 hotels in Africa, and to achieve this we will enter new capital cities and financial hubs and proven resort destinations,” says Andrew McLachlan, Carlson Rezidor’s Vice-President Business Development, Africa and Indian Ocean Islands.

Nigeria is currently one of the main focus areas for Carlson Rezidor – the group is planning to have 20 hotels there by 2020, with its first Nigerian Park Inn due to open later this year.

“The reason Nigeria is a hotspot for hotels is due to the size of the country, number of states (36), the largest population in Africa and its large growing economy, in addition to a complete undersupply of quality hotel rooms,” says McLachlan.

Another hotspot is Ethiopia, due to the county’s population and economic growth, where Carlson Rezidor is planning at least another five hotels. Meanwhile, in Rwanda, the group is planning to open a Radisson Blu, with the largest meeting and conference facilities in East Africa, as well as a Park Inn, in 2016.

“Carlson Rezidor has huge ambition for Africa, and we have full commitment from our board and shareholders. Today we have a full area support office in South Africa, which continues to grow as we add more hotels to our portfolio,” says McLachlan.

Hilton Worldwide has one of the longest presences in Africa, having been around for over 50 years, thanks to long-serving hotels in the likes of Nairobi and Addis Ababa. The group’s African portfolio now extends to 36 hotels, with almost 20,000 rooms either trading or under development on the continent.

“We are seeing demand driven by high numbers of inbound business and leisure travellers, intra-African travel, improving infrastructure and business investment, so we plan to grow our multi-brand pipeline across the continent,” says Jan van der Putten, Vice-President Operations: Africa & Indian Ocean.

“We believe that a lack of internationally-branded hotels in some markets presents an opportunity to grow our presence,” he says. “Our latest hotels to open in Africa include DoubleTree by Hilton Stone Town in Tanzania, DoubleTree by Hilton Zanzibar Nungwi and DoubleTree by Hilton Cape Town – Upper Eastside.”

Looking to the future, Van der Putten believes Hilton’s growth prospects in Africa focus on existing and new markets. The group is set to open properties in locations including Uganda, Nigeria, Kenya, Burundi, Zambia, Namibia, Morocco, Tunisia, Egypt and Chad.

“Sub-Saharan Africa is seeing significant development activity, particularly for the mid-market Hilton Garden Inn brand, which services demand for quality accommodation in the value segment,” he says.

Recent Hilton signings include the Hilton Garden Inn Windhoek in Namibia, Hilton Garden Inn Lusaka in Zambia and Hilton Garden Inn Abuja Airport in Nigeria. 

“We expect our first Hilton Garden Inn hotel to open in Africa in 2016, and the brand’s introduction to Africa will allow us to appeal to yet more segments of travellers,” says Van der Putten. “In sub-Saharan Africa we are also developing our upscale Hilton and DoubleTree by Hilton brands, in major city locations as well as holiday and resort areas.”

That said, Hilton is not neglecting North Africa and has recently announced new development projects in Egypt, Tunisia and Morocco.

Marriott International is expanding from the Middle East into North, East and West Africa, and down into South Africa, where it now has a significant presence after acquiring the 116-hotel Protea Hotels group in 2014. The company now manages, franchises and leases hotels across the Protea Hotels brand (103 hotels), the boutique Protea Hotel Fire & Ice! brand (three hotels), and the African Pride Hotels collection (10 hotels). 

“East and West Africa are important regions for us, and Marriott International is looking to open its first properties in Ethiopia, Ghana and Rwanda this year,” says Mark Satterfield, COO, Middle East & Africa for Marriott International.

Satterfield’s comments were backed up by Marriott’s President and Chief Executive Officer, Arne Sorenson, at Arabian Travel Market and the Arabian Hotel Investment Conference in June. There, Sorenson outlined regional growth plans that anticipate growth of the company’s Middle East and Africa portfolio to over 240 properties by 2020, with plans to add roughly 80 properties and almost 16,500 rooms. At present, Marriott operates or franchises 164 properties in the Middle East and Africa region, across nine brands in 17 countries.

“The Middle East and Africa region offers a tremendous opportunity for Marriott International,” said Sorenson. “We have ambitious plans for growth internationally and the region will play a large part in helping us achieve both our short-term and long-term targets. By the end of this year we should surpass one million rooms open or in development worldwide, with new hotels expected to create 150,000 new hotel jobs as they open.”

Marriott International has also outlined its region-wide plan to strengthen the presence of its brand portfolio, particularly the Marriott Hotels brand. This year alone, the Middle East and Africa region will see more Marriott Hotels opening than any other Marriott International brand. By 2020, the brand should see 20 Marriott Hotels open across the region.

Following last year’s acquisition of Protea Hotels, Africa will also remain a key priority for the company with openings set to take place in Algeria, Morocco, Ghana, Ethiopia and Rwanda in 2015.

Starwood Hotels & Resorts currently operates in 14 African countries – Nigeria, Algeria, Djibouti, Egypt, Ethiopia, Gabon, Gambia, Mauritius, Libya, Morocco, Seychelles, South Africa, Tunisia and Uganda – and is expecting to open 20 new hotels over the next five years. This will total 55 Starwood hotels in Africa, a huge increase on its current African portfolio.

Much of Starwood’s focus is on Egypt, where it has seven Sheratons and four Le Meridien properties, with a St. Regis due to open in Cairo in mid-2016 and a Westin before that – possibly January. Starwood is also expanding in Nigeria, with the opening later this year of the Four Points by Sheraton Ikot Ekpene. A Four Points by Sheraton will also open in Algeria later this year.

“The African continent has huge growth potential for Starwood. By the end of last year, Starwood had doubled its dedicated development team focused on growth in Africa. Today we have three development executives focused exclusively on Africa, based out of South Africa, Dubai and Brussels,” says Ahdab.

Best Western, following its unveiling of the Best Western Plus Lusaka Grand Hotel in Zambia (92 rooms), has 11 additional hotels (over 1,000 rooms) planned, in Nigeria, Cameroon, Ghana, Uganda, Zanzibar and Ethiopia, where the first Best Western will open within 12 months.

“We are working on leads in destinations like Kigali in Rwanda and Bujumbura in Burundi, and hope these opportunities will also come through,” says De Lacy.

Nigeria has set the pace for Best Western, he says, “but there are still additional opportunities in some of the regional capital cities, and other countries will begin to catch up”. “The successes of single visas for the East African countries of Kenya, Rwanda and Uganda will result in both the demand and opportunity for new hotel developments. As the seat of the African Union, Ethiopia will certainly see growth opportunities in Addis Ababa, but there are other destinations like Gondar and Axum which will also benefit from additional visitors to the country,” says De Lacy.

Each Best Western hotel is an independently owned and operated franchise, which offers hotel owners the unique advantage of retaining their independence while providing the benefits of a full-service, well-known lodging affiliation offering a global reservations system, distribution, sales and advertising standards.

“This gives us an edge over our competitors in many areas,” says De Lacy.

Moevenpick, meanwhile, is concentrated in North Africa, with 10 hotels and eight Nile Cruise boats in Egypt, and two hotels in Morocco with another major project in Marrakech signed in May and due to open at the end of this year. It also has two hotels in Tunisia with a third opening in Tunis in 2016, as well as the 5-star Moevenpick Ambassador Hotel Accra in Ghana, the “springboard for other projects in sub-Saharan Africa”, says Banks. This property is one of only two 5-star hotels in Accra and the only one in the CBD, where it draws a consistent stream of business travel, thanks to its quality offering.

“We continue to consider good opportunities in North Africa and in the sub-Saharan region, to strengthen our cluster approach. So, in addition to Abuja and Lagos in Nigeria, we are currently looking at opportunities in Senegal, Tanzania, Ethiopia, Angola, Cote d’Ivoire, Kenya and Rwanda. And within the next five years we will have projects in the pipeline in Central, East and West Africa,” says Banks.

Moevenpick’s edge on its competition, he adds, is the fact that it is an upscale brand with a strong emphasis on service levels, training and a strong food and beverage offering.

“Our upscale rather than luxury product is a perfect fit for the African continent,” Banks says.

Over the past two years, Four Seasons has focused on its “urban resort”, the totally refurbished and re-launched Four Seasons Hotel Westcliff in Johannesburg. Interestingly, Four Seasons opted to take on a property outside of the heavily-traded and popular economic district of Sandton, where most of Johannesburg’s big hotel brands have a presence. In fact, Four Seasons Hotel Westcliff in Johannesburg is in closer proximity to the city’s CBD, which is currently undergoing rejuvenation and is without a single big hotel brand.

“We chose to stay out of Sandton,” says Barillot. “First, because today’s affluent travellers seek memorable, ‘beyond compare’ experiences in life. Beyond exceptional service requirements, a conference or meeting takes on another dimension when lush gardens, fresh air, unmatched views and Johannesburg’s blue sky elevate the business day. Our property was uniquely re-invented as a vibrant “urban resort” for this very reason. We also see that the center of gravity for quality affluent living in Johannesburg has begun to shift towards Westcliff and the Parks. Long term, the burgeoning renaissance of the CBD is very appealing to enhance our investment, and we count many important corporate clients in Rosebank and the CBD.”

Four Seasons also has a luxury lodge in the Serengeti in Tanzania, and now Nigeria may be on its radar.

“Four Seasons is a global luxury consumer brand operating exclusively at the top tier of the luxury market, so we are very selective about our destinations, which need to be located either near or well connected to global hubs in key business markets, or benefit from good air access in exclusive resort destinations. We see the potential in Nigeria, and a good dozen other locations in the subcontinent, but we’re not ready to announce any deals yet,” says Sebastien Carre, General Manager of Four Seasons Hotel Westcliff. 

Hyatt and Kempinski are the other big players in sub-Saharan Africa aiming to double their presence in Africa according to the W Hospitality Group report, with Kempinski kicking off with its exciting 451-room Grand Hotel Oyala in Equatorial Guinea. Hyatt currently has three hotel properties in Africa, with a Hyatt Regency in each of Johannesburg and Dar es Salaam, along with the recently-opened Park Hyatt Zanzibar in Stone Town.

Then there is Swiss International, with 16 franchise deals, more than half of them in Nigeria, and Mangalis, a newish chain, planning its first hotel openings in Conakry and Dakar this year.

Expansion from the south

Just as the global hotel brands are claiming their place in the African sun, so too are the well-established brands in regional Southern Africa looking to spread their presence, although perhaps not as aggressively as the international players.

Tsogo Sun is one of South Africa’s best-known hotel groups, with over 90 properties across 14 brands, including Southern Sun, SunSquare, Garden Court, StayEasy and Sun1. It first expanded into the Seychelles in 1988 and today is in five other African countries, namely Kenya, Mozambique, Nigeria, Tanzania and Zambia.

Tsogo Sun’s most recent big project was the $30 million refurbishment of the Southern Sun Maputo in Mozambique, which entailed an additional 111 rooms as well as new conference facilities. The group will also soon be offering a new property in the Mozambican mining town of Tete. This hotel will consist of 156 rooms and will open in 2016.

In Nigeria, meanwhile, Tsogo Sun recently acquired a 75% stake in Southern Sun Ikoyi in Lagos, and it is in final negotiations for a full service hotel in Accra, Ghana, which will consist of 152 rooms. Last year, Tsogo Sun opened Southern Sun Abu Dhabi (353 rooms).

“When we invest in a country we ensure there is a natural trade link between South Africa and the selected country. The reason for this is that the brand is well known in South Africa and therefore trusted by customers elsewhere in Africa,” comments Richard Weilers, COO of Tsogo Sun.

In deciding on location for its projects, this group also looks at which of its brands would best fit.

“For example, in Zambia, we have a Southern Sun in Lusaka as well as a StayEasy, catering for both a full service market and a budget market. It’s important to us that the area has a good infrastructure close to corporate organisations, and we work closely with the local communities where we’re situated. Thus we’re seen as a committed partner in the countries where we have a presence,” says Weilers.

Another big  South African-based hotel group making inroads into Africa is Protea hotels, and with the backing of its new parent company Marriott International, it is currently planning a 130-room hotel in Ghana, a 25-room hotel in Kigali, Rwanda, and the 155-room luxury African Pride Hotel in Lagos, all scheduled to open later this year. This adds to Protea’s existing hotels in seven African countries – South Africa, Zambia, Nigeria, Namibia, Malawi, Uganda and Tanzania. Suffice to say that Protea Hotels is the largest hotelier on the continent.

“Protea Hotels and Marriott International are committed to expanding across the continent. Currently we employ 21,000 associates across Africa, and this workforce will increase by 10,000 people, as we have one of the strongest pipelines for new hotel development,” says Satterfield.

Back on home turf, Protea Hotels recently opened the Protea in Mowbray, Cape Town, the Protea Fire & Ice! in Menlyn, Pretoria, the Protea Malaga in Mpumalanga and the Protea Hunters Rest in Rustenburg in the North West – all this year.

Sun International, the South-African based resort hotel and casino chain, has properties in Nigeria (the Federal Palace Hotel & Casino), as well as Botswana, Lesotho, Swaziland, Namibia and Zambia, although this group is primarily clustered in South Africa.

Mindful of growing its own niche – casinos and casino resorts – Sun International is currently focused on refurbishments of existing properties, as well as its latest project, the $240-million Time Square at Menlyn Maine in Pretoria, consisting of a 5-star hotel and conference centre, casino and entertainment arena seating 8,000.

“We anticipate that as many as 10,000 jobs will be created during construction, and when operations start, that Time Square at Menlyn Maine will sustain about 2,200 jobs. Being cognisant of the multiplier effect, this project expects to deliver a cumulative contribution to the GDP of as much as $1.5-million over the first five years,” comments Michael Farr, Group General Manager, Corporate Brand and Communications for Sun International.

The group’s African hotels, meanwhile, are being managed by Minor International (MINT), a global hospitality company which Sun International partnered up with earlier this year.

“This transaction enables us to remain invested in the African assets but with responsibility for the casino component only,” explains Farr.

That said, Sun International plans to buy rival Peermont Hotels Resorts & Casinos for R9.4billion ($776 million). Peermont owns Emperors Palace near O.R. Tambo International Airport in Johannesburg, as well as 12 other leisure and gaming complexes in South Africa and Botswana, and this deal will enable Sun International to “undertake larger developments and acquisitions internationally” (though the group remains tightlipped as to what these might be).

Peermont, meanwhile, has just launched the 5-star President Walmont Hotel within the Umodzi Park business precinct in Lilongwe, Malawi. The project incorporates Malawi’s first 5-star hotel, the Bingu Wa Mutharika International Convention Centre (BICC), and the Presidential Villas. The BICC includes the Lilongwe Auditorium, which seats 1,500 delegates. Five conference rooms can be combined or used individually to cater for up to 70 delegates each. There are also three banqueting halls which can be used individually to host 200 delegates, or combined to cater to over 1,000 guests. A further four multi-functional venues offer varying configurations that each cater for 15 people in an executive boardroom set-up, or up to 60 people in cinema-style set-up.

The President Walmont Hotel overlooks Malawi Square and has 130 rooms and suites, a large reception area, lobby bar, lounge and the Wild Orchid Restaurant, with indoor seating and outdoor pool deck terrace offering an international breakfast buffet and an à la carte lunch and dinner menu. Additionally, there are 14 Presidential Villas in a secure estate – a short drive from Umodzi Park – offering a private clubhouse and relaxation and sporting facilities.

Peermont’s investment in this project is a vote of confidence in Malawi as an increasingly attractive option for conferencing.

This appears to be a new focus for Peermont, which has revamped its flagship Emperors Palace property in line with this, with its convention centre receiving a makeover. On top of this, the 5-star D’oreale Grande hotel is converting its fourth floor into a ‘suite floor’, which is expected to open 10 new suites in August. Aurelia’s restaurant is being refurbished with new decor and will soon offer a ‘chill lounge’ for early check-ins. The Queen of the Nile restaurant, which will be given a new name once refurbishment is completed, will be expanded and given a new interior design scheme.

Then there’s the other prominent South African hotel group City Lodge, a cautious investor but bullish about its plans in Kenya and Tanzania.

“We already have two hotels in Nairobi (Fairview Hotel and Town Lodge), and a Town Lodge in Botswana. We will soon start developing a City Lodge Hotel at the Two Rivers complex in Nairobi, as well as a City Lodge Hotel in Dar es Salaam, Tanzania – due to open in 2016,” says Angus MacMillan, PR Manager for the City Lodge group, adding that “negotiations are also underway for City Lodges in Uganda, Mozambique and Namibia. Ethiopia and Rwanda are also possible locations for our hotels.”

The advantage of the City Lodge offering is that it targets the two and three-star markets, an area a lot investors and experts believe has great potential and opportunity on the African continent.

“This is where we believe there is room for quality, value-for-money hotels”, says MacMillan.

Smaller South African-based hotel group, Legacy Hotels & Resorts, is looking at new building developments or management takeovers.

“We prefer Southern Africa, but would consider North Africa if the right opportunity arose. With Nigeria’s economic growth we will keep looking there, and likewise any other corporate opportunity. At present, we are about to expand The Wheatbaker hotel (in Lagos) by adding on new facilities and 50 extra rooms,” says Legacy Managing Director Paddy Brearley.

Legacy’s focus, for now, is on Sandton, South Africa’s economic hub in Johannesburg, with the Michelangelo Hotel, Michelangelo Towers, Davinci Hotels & Suites, and Raphael Penthouse Suites properties.

“Sandton is the place to be,” says Brearley. “The dominance of Legacy in the Sandton precinct is very important, because it does attract all our overseas guests to come and stay here. Sandton is the business hub of Africa, and if you look around it right now, the development is phenomenal.”

And Legacy isn’t done with Sandton just yet. The group has taken a decision to expand in the area with a property that Brearley describes as “key”. The Leonardo, in Maude Street, is over 40 storeys tall and Legacy is developing it not just as a hotel, but also a property offering apartments, offices and “great public areas”, according to Brearley. Completion is expected in the next two to three years.

Another interesting South African hotel group story is AHA/Three Cities. 2014 saw Tourvest Holdings buy Three Cities Management, in a move that saw its African Hotels and Adventures (AHA) business, a division of Tourvest, become the second largest tourism hotel and lodge management company in South Africa. In terms of the deal, Tourvest acquired the existing sales, marketing and management contracts for 23 hotels and lodges across the country, as well as TCM’s shares in the Alpine Heath and Greenway Woods resorts.

Also taking on a new identity in 2014 was EAH Executive Apartments & Hotels. As of 1 November, it became The Capital Hotel Group. The current portfolio consists of six properties situated in Sandton, Johannesburg, the heart of Africa’s financial and business hub, with expansion plans set for a further 11 properties, all to be located in capital cities in and around South Africa and the sub-Saharan market. The concept offers a full hotel service with the option of self-catering apartments and a host of facilities geared towards the requirements of both business and leisure travellers.

Another group with South African roots, but a more ‘international’ approach over the past few years, is Kerzner International, which numbers the One&Only in Cape Town and the Mazagan Beach & Golf Resort in Morocco as its only African properties, although it is showing a renewed interest in the African continent.

Outside of South Africa, Cresta Hotels and African Sun are two of the biggest players in Southern Africa. Cresta is particularly strong in Botswana, with properties in Gaborone, Francistown, Jwaneng, Kasane, Mahalapye, Maun, Palapye and Selebi-Phikwe. The group also has a property in Lusaka, Zambia, three in Harare, and one each in Bulawayo and Victoria Falls.

African Sun, in turn, has 12 properties in Zimbabwe, including four in Victoria Falls, three in Nigeria, and the single property in Ghana, in the form of the African Sun Amber Hotel Accra Airport, which opened towards the end of 2013 in a great location.

Verdict

Africa is the new frontier, and the battle of the giants has begun. No international brand hotel worth its salt can afford to not be in on the act!

2015 Hotel Openings in Africa

Carlson Rezidor (Radisson Blu) – Le Vendome, Cape Town (South Africa – opened); Nairobi (Kenya); 2 Fevrier, Lome (Togo); La Poste Lafayette (Mauritius); Azuri Resort & Spa (Mauritius); Sharm el Sheikh Lagoon (Egypt); Okoume Palace, Libreville (Gabon); Marrakech Carre Eden (Morocco)
Carlson Rezidor (Park Inn by Radisson) – Abeokuta (Nigeria), Kigali (Rwanda)
City Lodge
Hotel Waterfall City, Midrand (South Africa – opened) – the first new South African hotel for the group since 2010
Golden Tulip
Warri Airport (Nigeria)
Hilton
Alexandria King’s Ranch (Egypt) – 199 rooms and one of the largest swimming pools in the city; Hilton Garden Inn Tangier City Center
Hotel Pullman Kinshasa Grand Hotel (DRC)
Kempinski – Kempinski Hotel Gold Coast City, Accra (Ghana) – a six-floor, 5-star hotel with 269 rooms, including 22 luxury suites and two presidential suites; Royal Maxim Palace Kempinski, New Cairo (Egypt)
Marriott – Constantine Marriott (Algeria); Protea Hotel Select Takoradi (Ghana); Protea Hotel Kigali (Rwanda); African Pride Hotel, Lagos (Nigeria)
Mantis Group’s The George, Lagos (Nigeria – opened) – 62 rooms, including four penthouse suites
Peermont – President Walmont Hotel (Malawi – opened); Thaba Moshate Hotel Casino & Convention Resort, Burgersfort (South Africa – opened) 
Starwood – Four Points by Sheraton Oran (Algeria); Four Points by Sheraton Ikot Ekpene (Nigeria)
Wyndham – Ramada Resort Dar es Salaam (Tanzania – opened); Ramada Addis Hotel (Ethiopia) – 128 rooms and eight suite rooms, rooftop restaurant, VIP bar and conference facilities