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Nairobi tops in African hotel investments

 The Villa Rosa Kempinski Hotel in Nairobi. At least 11 new commercial hotels are set to open their doors in Kenya in the next few years. Photo/Diana Ngila
The Villa Rosa Kempinski Hotel in Nairobi. At least 11 new commercial hotels are set to open their doors in Kenya in the next few years. Photo/Diana Ngila 

Nairobi has entered the global hospitality map with 11 new hotels set to open in the coming months as global chains tap into growing business tourism.

The hotels in different stages of completion are expected to add 1,469 rooms in the market, making Kenya the fifth most attractive destination in Africa for international hotel chains according to the 2013 Africa Pipeline Survey by W Hospitality, an industry advisory group.

This is the first time Kenya has made it to the top ten. In the top four spots are Algeria, Angola, Egypt and Ghana.

In the past five years the country, especially Nairobi, has attracted billions of shillings in the hospitality industry. Recent additions are the Villa Rosa Kempinski and the Best Western Premier hotels.

“Nairobi is the focus of attention in Kenya, with seven companies entering the market — Best Western, Country Lodge with Novotel and Ibis, Accor, Carlson Rezidor with Radisson Blu and Park Inn, Dusit, easyHotel and Kempinski,” said the report.

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Most of these properties are in different stages of development and expected to open their doors in the next two years.

“Up until recently there has been a major shortage of decent hotels but we are seeing more and more coming into the market, which is a good thing,” said Agatha Juma, chief executive of Kenya Tourism Federation.

She projects that going forward, the investments will have to move to other counties, especially to the northern and western tourism circuits, which are undersupplied.

Major international hospitality companies have been aggressively looking to increase presence in Africa, which they see as the next growth market.

The survey found there are 207 hotels in the pipeline in Africa with almost 40,000 rooms, a 17 per cent increase compared to 2012, and 37 per cent higher than 2011. The hotels include only those where binding deals have been signed by the hotel chain and premises owner.

Egypt has attracted 20 hotels, Nigeria (49), Morocco (30), and Algeria (17). Ghana, Tunisia, Libya, South Africa and Gabon are the other countries in the top 10 list.

The Hilton and Radisson Blu hotel brands have the highest investment with 17 new properties each. Radisson Blu is looking to open its property in Kenya late next year. Other brands are Novotel, Ibid, Sogled Tulip, Park Inn, Marriott, Kempinski, easyHotel and Mantis.

“Africa is receiving more and more attention from the international chains, which clearly see the need to expand their presence, particularly with above-average growth in the number of travelers to the region and some of the fast-growing economies in the world,” said the report.

These hotels have been seeking partnerships with developers to manage their properties under contracts that lend the brand name, for a fee.

This year’s survey looked at 29 hotel groups, who have 59 brands between them. Most of the hotel chains already have a presence on the continent with about 90,000 rooms, though majority are in North Africa — mainly Morocco, Tunisia and Egypt. However, there has been a slowdown in North Africa due to earlier supply and the recent political turmoil.

Most of these international hotel chains are expected to attend the Africa Hotel Investment Forum (AHIF) to be held on September 23 in Nairobi.

Major deals are expected to be announced at the forum that brings together big players in the industry, especially those looking to establish a presence in Africa.

A new African hospitality group is expected to be unveiled at the conference sponsored by the Kenya Tourism Development Corporation.

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