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Major New Investment Deals In Africa Show Rise in Residential Hotels

Major New Investment Deals In Africa Show Rise in Residential Hotels

Marriott, Starwood and Carlson Rezidor are among the international hotel groups that announced major new hotel deals in Africa at the African Hotel Investment Forum 2015, which ended Oct. 1  in Ethiopia, IndependentOnline reports.

Carlson Rezidor announced its first Radisson Blu residence in Nairobi, Kenya — its third project in Nairobi and the group’s fifth Radisson Blu residence in Africa. Carlson Rezidor does business in 27 African countries including 30 hotels now open with 6,700 rooms and 35 hotels being developed with 7,600 rooms.

“Hotel residences are becoming an increasingly important offer for business and leisure travelers alike,” said Wolfgang M. Neumann, President & CEO of Rezidor, in a May statement. A hotel residence offering will allow Carlson Redizor to capture additional market share, he said.

A hotel residence, also known as an extended-stay hotel or residential hotel, is a serviced apartment complex that uses a hotel-style booking system. It is similar to renting an apartment, but with no fixed contracts. Occupants can check out whenever they want.

The Radisson Blu Hotel & Residence in Cape Town, announced in May with a planned opening for late 2016, will comprise 214 hotel rooms and 124 apartments

Marriott International in partnership with Sunshine Business announced its first Marriott executive apartments in Addis Ababa, Ethiopia, IndepdendentOnline reported.

It currently has four properties in North Africa with more than 2,000 rooms but by 2020 expects to open a further 12 properties to raise the room count by almost 3,000 rooms.

Africa is important to the Marriott group because of its rapid economic growth, growing middle class and youth population, and the expansion of international flights to the continent, said Alex Kyriakidis, president and managing director of Marriott International Middle East and Africa.

“With over 850 million people in sub-Saharan Africa, there are enormous opportunities there,” he said.

Starwood Hotels & Resorts Worldwide, which has 34 operating hotels and a pipeline of 20 hotels under development in Africa, announced seven new hotel deals – two in Nigeria and one each in Egypt, Mali, Kenya, Senegal and Tanzania. Starwood said it plans to grow its portfolio in Africa and the Indian Ocean by more than 50 percent over the next five years.

The momentum of growth in Africa today is unprecedented, said Michael Wale, president for Starwood, Europe, Africa and Middle East.

Tourist numbers are projected to increase by 5.7 percent a year in Africa through 2030 compared to 3.2 percent globally. Hotel demand is expected to grow at a rate of 5 percent a year between now and 2017, according to services and investment management firm Jones Lang LaSalle, IndependentOnline reports.

“Increased tourist arrivals to Africa are coming off a very low base, with only a 4.9 percent share of all global arrivals, and this should signal a massive potential for future growth,” according to Jones Lang LaSalle. “This is a promising outlook for international guest demand.”