Major hotel brands eye Africa

chika ebuzor

May 29, 2015 9:39 PM

Some experts say the countries that have tourism attractions and a thriving crude oil industry, stand a higher chance to benefit from real estate investments.

Major hotel brands eye Africa.

The increase in foreign and local business partnerships in the African continent has given rise to the need for quality hotel and leisure accommodation facilities.

Arthur Gillis, CEO of Protea Hospitality Group, which has investments worth over $100m in countries like Zambia, Rwanda, Ghana, Nigeria, Uganda and South Africa, says “Africa has more development potential than just about anywhere else in the world. He says many African economies are expanding rapidly and “it’s encouraging to see GDP projections of between 6% and 8% becoming reality on the back of political stability.”

Most experts say the Mckinsey report of 2011, which announced to the world that Africa’s consumer spending will increase to $1.4 trillion by 2020, really opened the eyes of investors to see Africa.

Wayne Troughton, CEO of HTI Consulting, a hospitality and property consultancy, posits that the adoption of management contracts will boost the African hospitality industry.

A management contract comes in place when a hotelier allows another company to manage his hotel for a fee.

Troughton says 'A management company’s structure would be that it gets paid on a percentage of revenue of the hotel and then also on a percentage of gross operating profit. We’re also starting to see some hotel chains putting in key money, or others having structures like funds to support expansion, though these are not the norm.'

International real estate firms are really jostling to be a part of the African real sector.

chika ebuzor