According to new research from the Lagos-based W Hospitality Group, the top names in the hotel industry are attempting to increase their market presence in Africa
Over the next five years, 208 new hotels with over 38,000 rooms are in the pipeline following unprecedented African economic growth.
Nigeria is set to receive the greatest level of investment, with 43 hotels (6,808 rooms) planned. It is followed by the popular North African tourist destinations of Morocco and Egypt, with 35 and 19 new hotels respectively. Algeria, Tunisia, Ghana and Gabon are also highlighted as well as Libya, despite its current problems, with three new hotels.
Of the major hotel chains building in Africa, Accor leads the way with 36 hotels (5,982 rooms) planned, followed by Carlson Rezidor with 25 (5,337 rooms) and Hilton with 11 (3,380 rooms). InterContinental Hotels Group, Marriott, Mövenpick and Starwood are also investing heavily across the continent.
According to a recent report in The Sunday Times, over the past decade six of the world’s 10 fastest-growing economies have been African, with Ghana increasing by 13% in the past year alone. African growth is predicted by the IMF to average 6% in 2012.
“While the major hotel pipeline development is taking place in North Africa, we are seeing serious global investors undertaking hotel development projects in virtually every country in Africa,” says Trevor Ward, managing director of W Hospitality Group. “This is a continent whose time has come.”
Yet Africa as an investment is still a challenge. Poor infrastructure and a lack of skills in the labour force are likely to pose problems for companies investing, as well as the threat of political instability and corruption. Identifying reliable and efficient business partners will be of the utmost importance to investors.