Hotel groups around the world are contemplating investing hundreds of million of dollars in Africa in the coming years to meet increased demand from both international tourists and natives on the continent. InterContinental Hotel Group, Accor, Starwood and Rezidor Hotel Group, the group that operates the Radisson Blu chain, are among those looking to capitalize on the continent’s urbanization.
In 2009, Africa was the only region in the world to show growth in tourism according to the World Tourism Organization. In 2010 international arrivals rose by 6 percent to 49 million, slower than Asia or the Americas but double the growth rate for Europe.
Industry executives say that as consumer spending stalls in developed markets, more multinationals are betting Africa’s growth will eventually translate into meaningful revenue, if they can negotiate the considerable regulatory and infrastructure challenges of doing business there.
Andrew McLachlan, Rezidor’s vice-president for business development in Africa and Indian Ocean islands said, “In the last 48 months we’ve added 33 hotels, some already opened and others under development to the African continent. If we don’t have any curve balls, we should open another eight hotels in 12 months across five countries.”
Among the projects planned was a $40 million Radisson Blu upscale hotel in the Mozambican capital of Maputo and a 120-room $42 million lodge in South Africa’s Kruger National Park, expected to open in 2013.