Hotel Chain Development Pipelines in Africa 2021

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Each year the Lagos-based W Hospitality Group, an industry constant, publishes their Hotel Chain Development Pipelines in Africa report and analysis. This is the 13th year they have produced a report, which they describe as “something of a curate’s egg’, with good news and bad.

Looking forward this time last year, it was inevitable that the COVID-19 pandemic would result in a slowdown in pipeline growth, as the industry got to grips with the new reality. With so many of the players locked down it looked like fewer deals could be signed, and that has proved to be the case. Whilst the crisis had a profoundly negative impact on Africa’s travel and hotel operations, the impact on deal signing was, surprisingly, much less, down “only” 30% on 2020.

Whilst the continued activity by the chains in expanding their footprint contributed to an increase in the 2021 pipeline, another factor was the inevitable reduction in the number of hotels opening last year. At the beginning of 2020 it was anticipated that 90 hotels with 17,000 rooms would open across Africa during the year, but in the event only just over a quarter of those opened their doors. Delays were for many reasons, all pandemic-related, including construction site closures, cargo delays, lack of finance and, for those projects which were completed, the lack of any demand in the market. Much of this was due to an unprecedented level of government regulation and legislation, which is continuing to impact on hotel development and operations.

Here are the main findings of the study.

Report Highlights

This 13th edition of our annual survey has a record 40 international and regional (African) contributors, reporting pipeline activity of just around 82,000 rooms in 447 hotels as of Q1 2021.

Hotel Chain Development Pipelines in Africa 2021

Regional Summary

  2018 2019 2020 2021
  Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms
North Africa 120 28,643 125 29,294 120 29,250 135 31,747
Sub-Saharan Africa 298 47,679 276 45,861 288 48,646 312 50,252
TOTAL 418 76,322 401 75,155 408 77,896 447 81,999

The total is up just over 5% on 2020, which whilst positive in terms of continued signings is also a function of far fewer hotel openings last year – 25 properties (a record low) compared to 68 in 2019.

There has been growth of almost one quarter (22%) in the total pipeline rooms since 2017, with growth in North Africa, particularly in Egypt, far higher, at 34% compared to sub-Saharan Africa’s 17%. West Africa is, as ever, the largest region in sub-Saharan Africa, with 49%of the regional pipeline (30% of the African total), which is up from 47% last year.

The pipeline total shows an increase in rooms on 2020, more than 9 per cent ahead of 2019, and 71 deals with 10,011 rooms were signed in 2020 and early 2021, not counting a few that were signed and opened the same year.

When analysed according by country and by the number of rooms in their pipeline, the top ten countries represent 71% of the total hotels in the survey, and 76% of the rooms.

Hotel Chain Development Pipelines in Africa 2021

Top 10 Countries by Number of Rooms

  Hotels Rooms Average Size
1 Egypt 67 19,272 288
2 Nigeria 62 9,032 146
3 Morocco 38 6,084 160
4 Ethiopia 33 5,886 178
5 Kenya 19 5,339 281
6 Algeria 29 4,354 150
7 Cape Verde 16 3,392 212
8 Senegal 16 3,359 210
9 Tunisia 23 3,356 146
10 South Africa 15 2,337 156

Egypt has, as in several previous years, by far the largest number of rooms in the pipeline, well over double the number in second-placed Nigeria, due to a continued deal-signing spree, led by Accor and Marriott, the former signing six deals with about 1,320 rooms there in 2020, and Marriott three hotels with about 1,050 rooms.  Four Seasons and Radisson signed one apiece.

Hotel Chain Development Pipelines in Africa 2021

Top 10 Countries by Pipeline Status

Hotels Rooms
Total Onsite Construction
1 Egypt 67 19,272 8,934 46.4%
2 Nigeria 62 9,032 4,536 50.2%
3 Morocco 38 6,084 4,366 71.8%
4 Ethiopia 33 5,886 3,814 64.8%
5 Cape Verde 19 5,339 3,366 63.0%
6 Kenya 29 4,354 3,026 69.5%
7 Algeria 16 3,392 2,528 74.5%
8 South Africa 23 3,356 2,429 72.4%
9 Senegal 16 3,359 1,921 57.2%
10 Tunisia 12 2,329 1,440 61.8%

After a couple of years of decline, the pipeline in Nigeria increased by a massive 16% last year, with signings by Best Western, Radisson and Swiss International, as well (of course!) by Accor and Marriott. Morocco, in third place, has seen a 10% increase in pipeline deals, up from 5,530 rooms in 2020.

Cairo has by far the largest pipeline, followed by Addis Ababa, with Nairobi, Lagos, Hurghada and Abuja all at much the same level

Looking at the development activity of the hotel chains, Marriott leads in terms of the number of hotels, while Accor leads in terms of the number of rooms.

Hotel Chain Development Pipelines in Africa 2021

Top 10 Chains by Number of Planned Hotels

Rank by Hotels
Units Rooms Change on 2020 Average Size
1 Marriott International 94 18,723 5% 199
2 Accor 89 19,241 14% 216
3 Hilton 55 10,348 3% 188
4 Radisson Hotel Group 34 6,461 -13% 190
5 Bon Hotels 18 1,435 -11% 80
6 IHG Hotels & Resorts 16 2,830 7% 177
7 Swiss International 15 1,381 92
8 Hyatt International 12 2,203 19% 184
9 Mangalis Hotel Group 12 1,350 0% 113
10 Barceló Hotel Group 8 2,488 121% 311

There is a clear gap between the first two (Accor and Marriott International) and the next two (Hilton and Radisson), and between these top four and “the others” – the top four chains account for fully two thirds of all of the pipeline rooms! And these top 10 chains have just over 80% of the pipeline, with the other 28 chains each having an average of less than 1% of total rooms.

In absolute terms Accor had the highest net increase in its pipeline, 2,400 rooms, and signed 14 deals in 2020. Radisson saw a net reduction in their pipeline, due to openings, whilst Marriott signed 9 deals and achieved a 5% net increase.

Marriott and Accor are the top two hotel chains when ranked by pipeline status. The Top 10 combined have almost 80% of all the chain hotels under construction in Africa, and the top four – Marriott, Accor, Hilton and Radisson – account for 58% of the total.

Hotel Chain Development Pipelines in Africa 2021

Top 10 Chains by Pipeline Status

Hotels Rooms
Total Onsite Construction
1 Marriott International 94 18,723 8,316 44.4%
2 Accor 89 19,241 8,066 41.9%
3 Hilton 55 10,348 5,747 55.5%
4 Radisson 34 6,461 4,769 73.8%
5 Hyatt 12 2,203 2,203 100.0%
6 Meliá Hotels & Resorts 6 1,954 1,954 100.0%
7 IHG Hotels & Resorts 16 2,830 1,730 61.1%
8 Deutsche Hospitality 4 1,503 1,503 100.0%
9 Bon Hotels 18 1,435 1,435 100.0%
10 Swiss International 15 1,381 1,026 74.3%

The chains anticipate that 99 new hotels are expected to open this year, and 115 in 2022, although their expectations are often over-optimistic – after a positive trend in 2019, the actualisation of hotel deals (the proportion that opened, compared to what the chains expected to open) was less than 30% in 2020.

Hotel Chain Development Pipelines in Africa 2021

Anticipated Opening Years of Pipeline Deals

Anticipated Opening Date Hotels Rooms Cumulative New Rooms Open
2021 99 15,314 15,314
2022 115 19,338 34,652
2023 77 13,583 48,235
2024 39 8,798 57,033
2025 47 10,580 67,613
2026 12 2,460 70,073
2027 and later* 58 11,926 81,999
* includes some where the opening date is not known

That’s over 34,000 rooms expected to open by the end of next year which if realised will contribute substantially to the much-needed improvement in the quality of Africa’s hotel industry, and creating those much-needed jobs.