Business
Africa hotel development: It’s Egypt, Morocco, Accor & Marriott
This year’s annual survey, which is widely acknowledged as the industry’s most authoritative source, has, as of Q1 2022, a record 42 global and regional (African) contributors
TAGHAZOUT, Morocco, June 2, 2022/APO Group/ —
Just four words are needed to sum up the main findings of this year’s African hotel chain development pipeline survey conducted by W Hospitality Group, in association with the Africa Hospitality Investment Forum (AHIF); those words are Egypt, Morocco, Accor and Marriott.
This year’s annual survey, which is widely acknowledged as the industry’s most authoritative source, has, as of Q1 2022, a record 42 global and regional (African) contributors, reporting on a pipeline of hotel development activity totalling around 80,300 rooms in 447 hotels, in 42 of Africa’s 54 countries.
Looking first at the number of rooms physically under construction, Morocco and Egypt are ahead of the pack, with 5,577 and 6,142 rooms respectively. They are followed by: Ethiopia, 3,871; Cape Verde, 3,016; Nigeria, 2,544; Kenya, 2,450; Algeria, 2,337; Tunisia, 2,280; South Africa, 1,948 and Senegal, 1,919. In Tunisia, Kenya and Morocco, over ¾ of the pipeline is “onsite”, whereas in Egypt, 71% is just at the planning stage, reflecting its relatively “young” pipeline (a lot signed in the last 3 years). While Nigeria has 45% onsite; eight of the 15 hotels (with half of the total rooms) that have started construction have stalled, and the sites are closed.
| Hotel Chain Development Pipelines in Africa 2022Top 10 Countries by Pipeline Status | ||||||
| Hotels | Rooms | |||||
| Total | Onsite Construction | |||||
| 1 | Egypt | 85 | 21,281 | 6,142 | 28.9% | |
| 2 | Morocco | 50 | 7,209 | 5,577 | 77.4% | |
| 3 | Ethiopia | 29 | 5,206 | 3,871 | 74.4% | |
| 4 | Cape Verde | 17 | 4,639 | 3,016 | 65.0% | |
| 5 | Nigeria | 33 | 5,619 | 2,544 | 45.3% | |
| 6 | Kenya | 24 | 3,155 | 2,450 | 77.7% | |
| 7 | Algeria | 15 | 3,202 | 2,337 | 73.0% | |
| 8 | Tunisia | 14 | 2,918 | 2,280 | 78.1% | |
| 9 | South Africa | 21 | 3,133 | 1,948 | 62.2% | |
| 10 | Senegal | 13 | 2,693 | 1,919 | 71.3% |
The picture changes somewhat when one looks at rooms being planned as well as those under construction. In this approach, Egypt is the star. It doesn’t just lead the country table, with over 21,000 rooms in 85 hotels in development, up 20 per cent on last year; but it is streaking ahead of the pack. It has almost three times the number of new rooms planned as Morocco, and almost four times Nigeria, which was top of the table for many years. What’s more, with continued signing activity (20 hotels with about 5,250 rooms last year), Egypt now accounts for over 25 per cent of the total hotel development pipeline. Morocco has 7,209 rooms in development, spread across 50 new hotels; Nigeria has 5,619 rooms in 33 hotels, Ethiopia has 5,206 rooms spread across 29 hotels and Cape Verde has 4,639 rooms in 17 hotels. The next five places are taken by Algeria, 3,202 rooms, Kenya, 3,155 rooms, South Africa, 3,133 rooms Tunisia, 2,918 rooms and Senegal 2,693 rooms.
| Hotel Chain Development Pipelines in Africa 2022Top 10 Countries by Number of Rooms | ||||
| Hotels | Rooms | Average Size | ||
| 1 | Egypt | 85 | 21,281 | 250 |
| 2 | Morocco | 50 | 7,209 | 144 |
| 3 | Nigeria | 33 | 5,619 | 170 |
| 4 | Ethiopia | 29 | 5,206 | 180 |
| 5 | Cape Verde | 17 | 4,639 | 273 |
| 6 | Algeria | 15 | 3,202 | 213 |
| 7 | Kenya | 24 | 3,155 | 131 |
| 8 | South Africa | 21 | 3,133 | 149 |
| 9 | Tunisia | 14 | 2,918 | 208 |
| 10 | Senegal | 13 | 2,693 | 207 |
| Total | 301 | 59,055 | 196 |
Notably, four out of the five North African countries are in the top ten; and the top ten countries represent 67% of the total hotels, and 74% of the rooms, in the survey.
While Africa’s hotel development pipeline is at its strongest ever, 80,291 rooms being planned or constructed, the top-line number masks a reduction in Sub-Saharan Africa, where there has been a greater amount of hotel investment in recent years. Of the six sub-Saharan countries in the top 10, only Cape Verde has seen an increase in planned rooms, 33%, whilst the “power houses”, Nigeria, Ethiopia, Kenya and South Africa have between them seen a decline of 29%; Nigeria is down 41%. There are three main reasons for the reduction: fewer new opportunities in the region; opening of some 2,700 rooms in 15 hotels last year, and a pipeline “cleansing” which the hotel chains do periodically to remove various projects which are unlikely to go ahead.
| Hotel Chain Development Pipelines in Africa 2022Regional Summary | ||||||||||
| 2018 | 2019 | 2020 | 2021 | 2022 | ||||||
| Hotels | Rooms | Hotels | Rooms | Hotels | Rooms | Hotels | Rooms | Hotels | Rooms | |
| North Africa | 118 | 28,303 | 122 | 28,702 | 119 | 29,050 | 134 | 31,547 | 166 | 35,280 |
| Sub-Saharan Africa | 294 | 46,731 | 270 | 44,395 | 283 | 47,684 | 289 | 47,855 | 281 | 45,011 |
| TOTAL | 412 | 75,034 | 392 | 73,097 | 402 | 76,734 | 423 | 79,402 | 447 | 80,291 |
Looking at the development activity of the hotel chains, both Accor and Marriott are nearly as dominant as Egypt and Morocco, each representing just over 25% of the entire pipeline! Accor has 20,857 rooms in development, spread over 107 properties; Marriott has 20,248 rooms spread over 103 properties. Hilton, in third place, has around half as many rooms, 10,505 in 55 hotels. Radisson, 4th, has 6,248 rooms in 35 hotels. The next six places are taken by IHG, 3,136 rooms, Barceló, 2,488 rooms, Hyatt, 1,995 rooms, Meliá, 1,743 rooms, Louvre, 1,273 rooms, and Minor, 1,203 rooms.
| Hotel Chain Development Pipelines in Africa 2022Top 10 Hotel Chains by Number of Planned Hotels | |||||
| Rank by Hotels | |||||
| Units | Rooms | Change on 2020 | Average Size | ||
| 1 | Accor | 107 | 20,857 | 8.4% | 195 |
| 2 | Marriott International | 103 | 20,248 | 8.1% | 197 |
| 3 | Hilton | 55 | 10,505 | 1.5% | 191 |
| 4 | Radisson Hotel Group | 35 | 6,248 | -3.3% | 179 |
| 5 | IHG | 17 | 3,136 | 10.8% | 184 |
| 6 | Barceló Hotel Group | 8 | 2,488 | 0.0% | 311 |
| 7 | Hyatt Hotels & Resorts | 12 | 1,995 | -9.4% | 166 |
| 8 | Meliá Hotels & Resorts | 5 | 1,743 | -10.8% | 349 |
| 9 | Louvre Hotels Group | 11 | 1,273 | -4.2% | 116 |
| 10 | Minor Hotels | 6 | 1,203 | – | 201 |
Trevor Ward, Managing Director, W Hospitality Group said: “The chains anticipate that 200 new hotels are expected to open this year and next, although their expectations can sometimes be over-optimistic! After a positive trend in 2019, the actualisation of hotel deals (ie: the proportion that actually opened, compared to what the chains expected to open) was less than 30 per cent in both 2020 and 2021 – however, that was quite understandable with pandemic travel restrictions killing the demand for hotel rooms.”
Trevor continued: “I am not surprised by the slow-down in the number of deals signed in sub-Saharan Africa, as the past couple of years have seen not only the pandemic, making it more difficult to travel and meet new partners, but also less appetite from investors for major markets such as Ethiopia, Nigeria and South Africa. However, what does surprise me is that the majority of investment is going into upscale, upper upscale and luxury hotels, when there is very strong demand across Africa for decent quality branded budget and midscale hotels.”
Matthew Weihs, Managing Director of The Bench, which organises AHIF, concluded: “While the hospitality industry has just been through the bleakest period in my professional career, it is fascinating to see that the pandemic has done nothing to dent long-term investor confidence in hospitality. If anything, the savviest financiers have seen it as an opportunity. They have been encouraged by enlightened governments, such as Morocco’s, which have spent $ billions on new infrastructure to incentivise investment in tourism. What’s more, judging by our other conferences this year that have sold out, we are seeing how keen people are to travel again and how valuable it is to meet face to face, rather than over a video link. I am confident that when AHIF takes place on 2-4 November, in Taghazout, close to Agadir, we will see the atmosphere buzzing, with highly productive networking and with more deals announced than ever before.”
An update to the pipeline development survey, along with in-depth insights, will be presented by Trevor Ward at AHIF. The event is the leading conference of its kind in Africa, connecting business leaders and fuelling investment in tourism projects, infrastructure and hotel development across the continent.
Distributed by APO Group on behalf of Bench Events.
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Africa Practice research shows that Africa exports up to 98% of its raw cotton overseas and captures only 2% of its total value while incurring a USD 35 billion annual trade deficit
African culture, design, and storytelling influence global fashion, music, and media like never before
Africa Made It is driven by a consortium of leading pan-African organisations, advocacy groups, and media organisations who are positioning Africa as a global investment hub. Its flagship campaign, spotlighting the fibre-to-fashion value chain, presents a clear roadmap for continental industrialisation: securing competitive energy power for local industrial mills, enacting policy measures to protect emerging domestic manufacturers from unfair foreign imports, and rallying African consumers to purchase locally manufactured apparel. Together, these three pillars ensure that value created from African resources remains on African soil.
Africa Practice research shows that Africa exports up to 98% of its raw cotton overseas and captures only 2% of its total value while incurring a USD 35 billion annual trade deficit. Building the continent’s domestic processing capacity in spinning, weaving, and sewing locally produced cotton will sustain nearly two million permanent industrial jobs and inject approximately USD 33 billion directly into domestic household incomes every year, in addition to a recurring contribution of USD 34 billion to the continent’s GDP.
While these figures reveal the immense macro-economic potential of the value chain, the true heart of this transformation lies in its human impact. Industrial wages and local lint purchases leading to increased capital circulation in rural communities can drive community micro-economic vitality and contribute to rural poverty reduction. Additionally, formal employment opportunities can expand drastically for women, as they currently make up between 70-90% of garment factory workers on the continent.
Realising this vision and changing the lives of millions of people requires a deliberate combination of targeted investments, supportive trade policies, and consumer mobilisation. A USD 1.8 billion capital allocation toward critical structural enablers for garment transformation is the foundation for bridging Africa’s missing middle in the fibre-to-fashion value chain.
Marie Wilke, editor-in-chief of the Africa Made It magazine, said, “African culture, design, and storytelling influence global fashion, music, and media like never before. Yet, without domestic manufacturing infrastructure, Africa’s creative authority yields very little economic return. Linking raw cotton harvest directly to local processing ensures that the intellectual property, commercial margins, and industrial jobs remain on the continent. It is time to wear our power.”
To learn more about the potential of Africa’s fibre to fashion value chain, watch the campaign video (https://apo-opa.co/4BKAIvY) or read the Africa Made it (https://apo-opa.co/4zvA5VF)magazine (https://apo-opa.co/4zvA5VF). Access the campaign website and resources in English (https://apo-opa.co/4zvA5VF) and French (https://apo-opa.co/4zrK8e2).
Distributed by APO Group on behalf of Africa Made It.
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