Remaining Bullish

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The Garissa University College attack in Kenya in April couldn’t have come at a worse time, just as the country was looking to emerge from the funk of the past two years, brought on by even more terrorist activity and the impact of the Ebola virus. But those in the business travel industry remain bullish about the road ahead, as Editor Dylan Rogers found on a trip to Cape Town for WTM Africa.  

Ali Akbarali is the Director of Business Development at Maple Star Hotels, a group that includes the Crowne Plaza Nairobi, Holiday Inn Johannesburg Airport, Sunnyside Park Hotel (Johannesburg), Shumba Valley Lodge (Johannesburg) and Holiday Inn Express & Suites Collingwood-Blue Mountain in its portfolio.

Allan Clingham is the General Manager of the Crowne Plaza Nairobi, having previously held the same position at the brand’s property in Johannesburg.

The two men are not only experienced hoteliers, but also share a belief and faith in the future of Kenya, and Nairobi in particular.

“It’s the new hub of Africa,” says Akbarali, who has roots in both South Africa and Mozambique, although the family business has its origins in Canada. “Before, it was South Africa, but I think Nairobi is going to be a new hub for this region.”

That may be the case, but catastrophic events like the tragic Garissa attack – albeit nearly 400 kilometres away – must have some impact on the development of Nairobi as a business travel hub.

“It’s not likely to affect us,” says Clingham. “We’re a corporate hotel, a lot of our business comes from South Africa, and they are pretty tough travellers. It’s really going to affect the leisure market in Mombasa and the Mara area. Corporate areas and corporate destinations will be business as usual.”

Clingham may have a point, if one looks at W Hospitality’s annual ‘Hotel Chain Development Pipeline in Africa’. The 2015 report has eight hotels in Kenya under development – a total of 1,510 rooms, of which 1,220 are in Nairobi, and the overall Kenyan pipeline is 70% under construction.

“There’s a large supply of hotels coming to the market, so it’s definitely getting a little more competitive,” says Akbarali. “The traffic and infrastructure makes it very challenging to do business in Nairobi, but the government is responding and changes are being made.”

So, the signs are good, with the most imminent – and much-anticipated – hotel opening that of the Radisson Blu in Upper Hill in Nairobi, a stone’s throw from the Crowne Plaza.

“We’re looking forward to them opening,” says Clingham. “We’re the only hotel in our node currently, so we’re benchmarking our rates to the CBD. We’re always lowering our rates to play in the same market, so once they’re open we’ll have two hotels benchmarking each other with the same rates. Upper Hill is a bit like Sandton (Johannesburg) 25 years ago – it’s a brand new financial hub.”

Another ‘newish’ player in the Nairobi market is South African group City Lodge, which now owns the Fairview and the adjacent Country Lodge (now rebranded Town Lodge), just down the road from the Crowne Plaza. City Lodge also has big plans to expand its Kenyan footprint.

“It’s going to be interesting to see,” says Clingham. “It’s not a known brand in Kenya, but certainly it will attract the South African market. But other international travellers will not use it, because it’s not an international brand. The Kenyan market likes branded hotels.”

For Akbarali and Maple Star, there’s a long-term plan, and the group is betting big on the future of Kenya. Not only are there plans to add 44 rooms to the Crowne Plaza this year, but the group also has its eye on another hotel property in Nairobi.

“We’re looking to expand in Nairobi, despite what’s happening,” he says. “We see quite a lot of growth in the region. In addition, we see an advantage to putting more rooms on the market, because it takes two years to build. By the time these properties are ready, you’re going to have a flood of businesses. The new property will be branded and will follow the same standards as the Crowne Plaza. Anything you expect to get anywhere else in the world, we expect to have it.”

Bullish, indeed.