Africa: the world’s greatest future hotel development opportunity?
By Dexter Moren, Partner
I grew up in Johannesburg and maintain a strong affinity with Africa. My first hotel design was the 30-storey beachfront Marine Parade hotel in Durban in 1981. Since then, despite setting up a practice in London, I have returned to work on numerous other projects in the region.
Much has been made in recent years of growth prospects in Africa as many countries are starting to emerge after decades of post-colonial economic and political instability.
The region is the world’s most rapidly urbanising continent in the world: the number of people living in cities is expected to triple by 2050.
Alongside this we are seeing increasing household consumption, predicted by the Brookings Institute to reach $2.5 trillion by 2030. A growing middle class, the majority of which is younger than 35, points to the huge potential for future spending power growth.
More directly relevant for the hospitality sector, tourism is also growing. Recent figures place the region as the second fastest growing tourism sector in the word, fuelled by domestic and international visitors. This has helped drive development of a wave of new airport facilities opening and under construction in regional gateway cities.
The University of Cape Town estimates that by 2035, 8 out of 10 of the world’s fastest growing airports will be in Africa. As well as leisure travellers attracted by the natural beauty of the region, initiatives such as the African Continental Free Trade Area are promoting intra-regional business trips.
Despite this the number of hotels per capita across Africa is currently around a hundredth compared to the ratio in Europe or the Americas. The lack of hotels in major cities such as Lagos are reflected in very high rates.
The big chains are responding. The era of ‘return on ego’ 5-star plus hotels as vanity projects for the wealthy elite has largely ceased with a new focus on market-driven, midscale tourist and business hotels. Radisson is rolling out quickly as it aims for more than 130 hotels and 23,000 rooms across Africa by 2022. Hilton now has 100 hotels trading or under development in the region, while regional operators such as Azalai, Onomo and Mangalis are expanding with their own capital (JLL). Hotels are exhibiting the attributes of the new international focus on ‘lifestyle’, providing active and well needed facilities for locals as well as visitors to access.
Studio Moren designed Tsogo Sun’s SunSquare and Stay Easy Cape Town City Bowl Hotels are a great example of the new breed of hotel.
Occupying an entire city block in Cape Town’s central business district, this 20-storey landmark tower is a dual brand development comprising a 200-bedroom SunSquare hotel and 300-bedroom StayEasy hotel. Our design also features rooftop leisure facilities including a swimming pool, gym, lounge bar and terrace to maximise the spectacular views of Table Mountain, Signal Hill and the water front. At ground level, retail units, a restaurant and bar were designed to create an active street frontage.
It would be wrong to generalise across 54 counties, with many differences in both demand and economic and security stability, but in my opinion these facts reinforce an opinion that Africa represents the world’s greatest future hotel development opportunity. Pipeline delivery can be slow due to finance and construction complications but the Chinese are establishing a bridgehead of sorts in both infrastructure and building development - the West ignores Africa at their peril.