GLOBAL REPORT—Though many headlines point to Africa in its entirety as the next hotbed of hotel investment activity, the continent is less a uniform land of opportunity than a fragmented continent with disparate pockets of development.
Here are five African nations, deemed by sources, to be the continent’s hotel hotspots.
Côte d’Ivoire
Population: 20.1 million. Capital: Yamoussoukro. Gross domestic product (2012): +9.5%
Officially Côte d’Ivoire as opposed to the Ivory Coast, this west African nation’s business hub is former capital Abidjan. Despite still suffering from political turmoil (elections in 2010 bitterly divided it), experts hold hope.
“Abidjan is receiving a lot of attention. Several projects are planned, and Azalaï and Radisson Blu (hotels) are under construction. Cote d’Ivoire has the potential to regain its position as the center of Francophone West Africa,” said Trevor J. Ward, managing director of Lagos, Nigeria-based W Hospitality Group.
Ethiopia
Population: 84.7 million. Capital: Addis Ababa. GDP (2012): +8.5%
Ethiopia stands on the brink of a new era of energy, notably oil, although growth will be concentrated in capital Addis Ababa, home to the United Nations Economic Commission for Africa, sources said.
“Ethiopia is a large country with good economic growth and high tourism potential. Addis Ababa is one of east Africa’s hubs and has great air connections,” Ward said.
Peter Norman, senior VP of acquisitions and development for Europe, Middle East & Africa at Hyatt Hotels Corporation, shared a similar sentiment.
“Ethiopia, Kenya and Tanzania also have diversified their strategy beyond energy, which Nigeria has not done,” Norman said.
The country’s existing rooms supply has increased 2.3% year-to-date October compared to the same period last year, according to STR Global, sister company of Hotel News Now. Supply will increase an additional 62.7% if all 1,043 rooms in the total active pipeline open.
Ghana
Population: 24.9 million. Capital: Accra. GDP (2012): +7.9%
Ghana, in 1957 the first sub-Saharan African nation to gain independence, remains the most stable country in west Africa.
Michelè de Witt, director for South Africa at Horwath HTL, said Ghana’s economy has accelerated. As well as having oil, it also commands high global prices for gold, cocoa and other primary products.
“There is a high level of activity in Accra,” Ward said, “with a Marriott and a Kempinski slated to open in 2014 and other non-branded hotels under construction. (W Hospitality has) been very active there this year.
“Accra gets mostly international visitors, while Nigeria receives primarily domestic business travelers and some intra-African ones,” he added.
Though Ghana’s room count actually has decreased 1% year-to-date October, its supply stands to increase 7.5% if all 879 rooms in the total active pipeline open, according to STR Global.
Kenya
Population: 41.6 million. Capital: Nairobi. GDP (2012): +4.6%
Kenya, known for safaris and Mount Kilimanjaro, already possesses oceanside resort developments, although those in and close to Lamu perhaps are suffering due to proximity to war-torn Somalia.
“Certain areas of Africa, notably east Africa, have taken a decided upturn, but growth is not distributed evenly across all Africa, not by a long way. It is a mistake to basket the entire continent as one,” Norman said.
“(Also) helping (such countries as Kenya, Ghana and Nigeria) is good aviation connectedness and an emerging middle class with disposable income and willingness to travel,” de Witt said.
“Inbound capital also generates demand for countries such as Kenya. That is coming from China, Europe and the Middle East, and to some degree, United States,” Norman said.
Room supply has increased 3.5% in Kenya year-to-date October and could increase an additional 4.8% should all the rooms in the total active pipeline open, according to STR Global.
Tanzania
Population: 46.2 million. Capital: Dodoma. GDP (2012): +6.9%
“We see significant opportunity in Dar es Salaam (Tanzania’s business hub and former capital), as well as in Addis Ababa and Lagos, with Nairobi and Accra close behind,” said Bani Haddad, regional VP of Middle East and Africa for Wyndham Hotel Group.
“All these cities have enjoyed (recent) political stability, significant increase in airport arrivals, established themselves as regional hubs for specific industry sectors and witnessed high levels of growth, primarily driven by oil and gas,” he added.
Norman said growth in Tanzania will concentrate on Dar el Salaam, as well as Arusha and the famed isle of Zanzibar.
“Some Chinese industries already are moving from (Africa), so others are taking up the slack, and domestic industries such as textiles are booming. All this bodes well for sustainable growth. Plus, there’s tourism,” Ward said.
Tanzania’s room supply has increased 10.4% year-to-date October and could increase a further 9.2% should all 574 rooms in the total active pipeline open, according to STR Global.