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Trevor Ward, Managing Director, W Hospitality Group

Hotel development in Africa keeps on growing

Hotel development in Africa keeps on growing

Hotel development activity in Africa is still rising in the face of the continent’s economic problems, showing a 13 per cent increase in 2017, according to the annual survey by W Hospitality Group, generally acknowledged as the most authoritative source on the sector’s growth.

The ninth edition of its Hotel Chain Development Pipelines in Africa has 36 international and regional contributors reporting almost 73,000 rooms in 417 hotels. The figures have grown each year, more than doubling since 2009.

This year, bragging rights are shared; Marriott International, boosted by its merger with Starwood, comes top of the table in terms of number of rooms planned. But AccorHotels continues to lead – just – by the number of hotels in its pipeline. By country, Egypt is in first place with the highest number of hotel rooms in the on-site construction phase.

The report, along with all the challenges of developing new hotels in Africa will be discussed by industry leaders and government officials at the seventh Africa Hotel Investment Forum (AHIF) in Kigali, in October. AHIF is the highest-level gathering of hotel investors and developers in Africa.

Many African countries faced a challenging 2016, with lower prices for oil and other commodities, devalued currencies and other negative factors. That may have affected confidence in the short-term, as the number of deals signed was 86, down from 121 in 2015.

Despite the slowdown, some countries benefited from cheaper oil imports and there was increased activity in southern and east Africa. In addition, more hotel chains established development offices on the continent, to address the fact that Africa is still massively under-provided with rooms.

Growth is expected to be more muted in 2017, and financing and bureaucratic hurdles remain, but an increasing number of deals are coming to fruition on time: from only 26 per cent opening their doors on schedule in 2014, to 47 per cent in 2016.

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