Resort projects are increasing much faster
than city or airport hotels, driven by the number of signings and by the larger
average size of the developments, 210 keys versus 170.
AFRICA – There are 577 hotels and resorts,
with 104,444 rooms in the Africa development pipeline, up by 13.3% in early 2025
over 2024 and way ahead of the single digit pipeline growth reported globally
by the leading international chains, according to new data from 50 hotel
companies collected by Lagos-Nigeria-based W Hospitality Group.
North Africa saw a 23% year-on-year
increase, compared to a 6% increase in sub-Saharan Africa. Over the past five
years, the hotel development pipeline has grown at an annualized rate of 4% in
sub-Saharan Africa, 12% in North Africa and 7% overall.
W Hospitality Managing Director Trevor Ward
told Hotel Investment Today last week that that much needs to be done to
convert the deals to openings.
“There was significantly greater activity
in Africa last year, both in deal-making and in properties opening – but we do
need more,” Ward told Hotel Investment Today. “The development pipeline
averages about 10 per country on the continent, and the opening of hotels and
resorts last year averaged just over one per country. Both metrics are about
one-tenth of global averages.
“We’re getting there, the number of hotels
and resorts that opened in 2024 was double the previous year’s figure, and I
think that could double again this year.”
Egypt continues to lead the way in terms of
development with 143 hotels and 33,926 rooms in the pipeline. This is almost
four times the number of rooms in second-placed Morocco, which has 8,579 rooms
in 58 hotels. The following eight countries, ranked by number of rooms,
comprise Nigeria, 7,320; Ethiopia, 5,648; Cape Verde, 5,565; Kenya, 4,344;
Tunisia, 4,336; South Africa, 4,076; Tanzania, 3,432; and Ghana, 3,125. International
hotel chains have deals signed in 42 of Africa’s 54 countries.
Despite its clear leadership in the
absolute pipeline numbers, Egypt has fewer than 50% of rooms under construction,
a significantly lower proportion than second-placed Morocco, with over 72%. Of the top 10 countries, Ethiopia has the
highest ratio of rooms “on site,” followed by Morocco and Ghana. Cape Verde, Nigeria and Tanzania have some of
the lowest percentages. However, “under construction” does not necessarily mean
that there is activity and progress towards completion and opening – many of
the sites in Nigeria and Ghana, for example, have been closed for several
years, with hardly a hard hat in sight.
A more granular analysis, looking at the
location of planned properties, reveals a boom in Cairo, with 17,757 new rooms projected
in over 70 hotels. The contrast with the second-placed location, Sharm El
Sheikh, is dramatic, where 4,231 rooms are planned in fewer than 10 properties.
The cities and resorts with the next largest pipelines by number of rooms, are
Lagos, 3,709; Boa Vista, 3,650; Addis Ababa, 3,369; Casablanca, 2,939; Accra,
2,652; Abuja, 2,570; Zanzibar, 2,523; and Dakar, 2,334.
The growth is being driven strongly by the
major international hotel chains with Marriott International leading the way
with 165 hotels with 29,639 rooms. It is followed by Hilton, 93 hotels with 17,040
rooms; Accor, 73 hotels with 15,013 rooms; IHG, 40 hotels with 7,951 rooms; Radisson
Hotel Group, 32 hotels with 6,346 rooms; TUI Hotels & Resorts, 11 hotels
with 2,954 rooms; Barceló Hotels & Resorts, 7 hotels with 2,193 rooms; The
Ascott, 15 hotels with 1,897 rooms; Kerten Hospitality, 13 hotels with 1,881
rooms; and Wyndham Hotels & Resorts, 7 hotels with 1,706 rooms.
In the race for dominance, Hilton added
slightly more rooms to its African pipeline last year than Marriott and
achieved a higher percentage growth. Barceló Hotels & Resorts recorded the
largest percentage growth, more than doubling its pipeline to 2,193 rooms, with
three large resort signings in North Africa.
Below the headline numbers, there are three
notable trends. First, the actualization rate (actual openings vs. expected
openings), which has nearly doubled from 21% in 2023 to 38% in 2024. While it’s
substantially less than the 75% actualization rate achieved in 2019, it shows a
continuing recovery from the economic devastation of COVID-19. Of the total
104,444 rooms in the pipeline, over 50,000 rooms (nearly 50%) in 304 hotels are
expected to open in 2025 and 2026.
Second, resort projects are increasing much
faster than city or airport hotels, both in percentage terms and in absolute
numbers, driven by the number of signings and by the larger average size of the
developments, 210 keys versus 170. Also, almost half of the rooms that opened
last year were in resorts.
Third, there is a definite movement by the
chains towards the franchise model with 108 projects representing almost 19% of
the total, compared to less than 10% in 2020. A major factor is the emergence
of quality, international, white-label operators such as Aleph Hospitality and
Valor Hospitality, and some indigenous operators in Nigeria, Kenya and elsewhere,
that are increasing confidence that brand standards will be met.
“Despite
the various trials that the continent faces, the fact that hotel chains signed
125 new deals last year, with 21,000 rooms, is evidence that opportunities for
further development abound,” Ward said. “According to the Global Cities
Institute, by the year 2100, 10 of the world’s 16 largest cities will be in
Africa, with all but one of them (Cairo) in sub-Saharan Africa. So, one might
say that development activity in Africa has barely scratched the surface.”