Nigeria Leading Massive Hotel Boom in Africa
Jeff Edwards April 15, 2016
According to a just-released report, the number of new hotel rooms planned in Africa grew 30 percent over last year’s already impressive figures.
While the African continent is facing challenges that range from serious security threats to a volatile economic environment, growth in the hotel industry is stronger than ever. According to the latest Annual W Hospitality Group Hotel Chain Development Pipeline Survey, the hospitality sector is continuing to plan new hotel rooms in Africa at an ever-increasing pace. The latest report finds that the number of new rooms in the pipeline this year is up nearly 30 percent over the 2015 report which likewise showed impressive growth over the previous year.
“The evidence from our survey is clear,” W Hospitality Group Managing Director Trevor Ward told Hotel Management in a statement. ”Investors remain confident about the future of the hospitality industry on the continent. Even when pummeled daily by low commodity prices, exchange rate problems, political challenges and poor infrastructure, Africa remains resilient.”
In perhaps the most surprising news gleaned from the survey, the upward trend in new rooms is not being led by traditional tourist areas in North Africa but is instead being driven by demand in sub-Saharan regions. Angola is listed among the top African countries for the development of new hotel rooms. In partnership with AAA Activos LDA, Accor Hotels expects to open 50 new hotels with more than 6,000 rooms in the country by the end of this year.
Nigeria once again leads the continent in hotel development in this year’s report. Nigeria expects to see an almost 20 percent growth in new rooms by the end of 2016. According to the survey, Nigeria has 61 hotels with 10,222 new rooms in development, while Egypt has only 19 new hotels with 6,660 rooms in the pipeline.
“There are two reasons why development activity in North Africa is now somewhat subdued,” Ward explained. “Firstly, the markets there are more mature and have already seen much development, so there are fewer opportunities for new hotels. Secondly, there is the political turmoil–in Libya, which has seen a 40 percent drop in the pipeline, and also Egypt, parts of which are experiencing drastic reductions in the number of tourists.”
[Photo: Hotel Presidente Luanda, Angola]
At least 25% of the cost of a room in Nigeria goes to run the generators to keep the lights on. Look at the room rates at the Hilton or Sheraton in Abuja; Paris is cheaper. Nigeria: A country that is a member of OPEC with the annual electrical generation of Brussels.