Global brands to build five hotels in Kenya

In Kenya, Villa Rosa Kempinski, established in 1897 as a luxury hotel group, opened its doors to guests in 2013 with 200 rooms. PHOTO/DIANA NGILA

What you need to know:

  • The planned hotels are, however, fewer compared to Kenya’s peers such as Nigeria, which has attracted 40 hotel chains.
  • With the five new hotels, Kenya ranks twelfth in Africa — far below its rivals.
  • In the continent, Radisson Blu and its sister brand, Park Inn, occupy the first and third positions on account of the number of rooms in the pipeline.
  • Those planned for construction represent almost 50 per cent of the existing branded supply.

Five global firms plan to set up hotels in Kenya this year with a capacity of 704 rooms.

The planned hotels are, however, fewer compared to Kenya’s peers such as Nigeria, which has attracted 40 hotel chains, as investors seek to tap increased business travel in the continent.

The investment in Nigeria will see 6,614 hotel rooms set up.

With the five new hotels, Kenya ranks twelfth in Africa — far below its rivals.

The five are Radisson Blu and Park Inn, both franchises of Carlson Rezidor, DusitD2, Hilton Garden Inn by Hilton, and Elewana Hotel, according to Hotel Chain Development Pipelines in Africa 2014 report by the W Hospitality Group.

“One of the reasons the chains are doing less in Kenya is that the local players are quite dominant,” said W Hospitality Group head Trevor Ward.

“Our survey includes only the chains, and not the independents such as Sankara, which is just starting construction of its second hotel”.

In the continent, Radisson Blu and its sister brand, Park Inn, occupy the first and third positions on account of the number of rooms in the pipeline.

However, the ranking of the two brands operated by Carlson Rezidor slip to second and fourth positions when the actual number of rooms planned is taken into consideration, overtaken by Hilton and Marriott.

In January 2014, Marriott International’s chief executive, Arne Sorenson, told Bloomberg Television at the World Economic Forum in Davos that the hotel was considering opening shop in Kenya, Ethiopia, and Nigeria.

“We could be in Kenya very soon,” he said.

The W Hospitality Group report, which tracks planned hotel development in 54 African countries, only lists confirmed deals, although not necessarily or actually under construction.

Information is also gathered from hotels which operate in more than one country globally or, in the case of African chains, the hotel has to have a presence in at least one other country on the continent.

The 2014 survey is based on contributions from 27 hotel chains with 60 brands between them.

Of the 27 hotel chains, 24 are operating in Africa, with about 84,000 rooms.

Those planned for construction represent almost 50 per cent of the existing branded supply, the report indicated.

“Sub-Saharan Africa is really proving to be the hotel growth story of the 21st century,” Mr Ward noted, adding that in 2014, the 49 sub-Saharan Africa countries have a pipeline which is 40 per cent greater than North Africa.

Planned hotels in North Africa were affected by unrest, particularly in Egypt.

This prompted some deals that were in the pipeline to be suspended or cancelled.

Also, not all the reported deals signed are actually actively built or completed on time, given the difficult business environment in Africa.

Favourite spot

Besides Nigeria, which is the favourite spot for planned hotels in Africa, other countries in the top 10 are Morocco, Egypt, Algeria, Libya, Tunisia, South Africa, Ghana, Ethiopia, and Senegal in that order.

In Kenya, Villa Rosa Kempinski, established in 1897 as a luxury hotel group, opened its doors to guests in 2013 with 200 rooms.

In May the same year, Hemingways, a global hotel chain, opened a Sh1.5 billion hotel in Nairobi, targeting the growing luxury and travel business.

Marriott, another five-star international hotel, said it would open an outlet in Kenya by 2015 in a Sh127 billion ($1.5 billion) investment in Kenya, Ethiopia, Ghana, Benin, Gabon, Nigeria, and Rwanda.