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Hotels for Africa, and the Untapped Potential for Investors

Africa’s travel and tourism industry has a projected growth of 4.9% and accounts for nearly 9% of the continent’s GDP, the World Economic Forum (WEF) reckons. It’s that potential that led global hospitality consulting and services group HVS to set up office in Cape Town as a springboard into Africa.

There’s a huge opportunity for airlines and hotels to partner in creating packages. The purpose of the upcoming Tourism, Hotel Investment and Networking Conference, THINC Africa, which HVS is hosting in Cape Town in September, is to unleash this type of potential.

And what untapped potential there is in Africa for hotel investment!

All the major hotel groups have attended previous conferences in other parts of the world. This year there’s Hilton, Rezidor, Accor, Wyndham, Marriot, Hyatt, Tsogo Sun, Mantis Collection and Hard Rock. All of whom are interested in expanding in South Africa and across the continent.

“HVS has an unrivalled database of actual trading data across the globe so when we give opinion it’s based on the latest actual trading data,” says Tim Smith, managing partner of HVS in Africa.

“Although we can’t share the individual trading numbers due to confidentiality we can collate achieved performance to provide the most accurate indication of the likely trading performance of a proposed hotel. In fact, we will be releasing the 2016 Hotel Valuation Index at THINC Africa, which monitors the change in value of hotels across 21 markets in Africa, including three in South Africa.

“In terms of investment opportunities, I believe there are very interesting markets in southern Africa, because of accessibility through SAA. I believe Namibia has a big role to play in the future. Mozambique has a lot going for it too – in both cases, this applies to for business and leisure travel. SAA has been promoting Mozambique as a short hop destination for a quick break and Walvis Bay in Namibia has just become an international airport.

“Ethiopia is a really important territory for our clients. We’re already doing a lot of work in Addis and we’re now going to various regional cities. In Ethiopia, it started off as business travel in Addis, as it did in Nairobi. Kenyans and Ethiopians typically used to travel to Dubai for their short breaks because it’s a known quantity, whereas now they are starting to look at something closer to home. If you’re offering good quality accommodation that’s cheaper and closer to home, then you’ve got a nice market there,” concludes Smith.

THINC Africa is taking place at the Radisson Blu at the Waterfront from 6-7 September 2016. Online registration to attend the conference can be made at www.thincafrica.hvsconferences.com