individuals ,” Rotana ’ s El Zyr says . Smaller international chains in the Middle East are also more interested in investment .
Africa , however , is a different story . Because of the risky economy , “ It ’ s hard to minimize risk on this continent ,” Ward says .
That means most operators won ’ t be coming with cash infusions . As Haddad points out , creative fee management is key . Many flags are taking a bite out of their fees to gain a foothold on the continent .
Beyond financing issues , development in the region — especially in Africa — is partially directed by the challenges and needs of the physical properties . High construction costs pose a challenge in places like Lagos , as do “ import duties , transport costs , inefficiencies , contractor margins , the climate and oncosts such as generators and stoppages ,” Ward says .
Now is not the time for hoteliers to rush blindly into agreements with developers who don ’ t have the knowledge or the resources to bring a project from signing to opening . Hotels in Africa have specialized physical plant requirements . Boreholes , generators , water treatment and sewage plants are all on the list for most African hotels , according to Ward . And , that means a bigger back-of-house staff .
All of that begs the question as to how long hoteliers — and investors — would be willing to wait for jackpot returns when they could focus on the Middle East and start seeing at least some return within the usual ramp-up after opening . The answer will determine both the development and transaction pace for MEA over the next three to five years . Regardless of the headlines , the inside story here is a region with plenty of opportunities for both business and leisure travel to boost hotels ’ bottom line .
The Hilton Addis Ababa is one of the few big branded hotels in the Ethiopian capital , as most properties have fewer than 80 rooms and significantly lower rates .
HOTEL BRAND DEVELOPMENT IN AFRICA
RADISSON BLU |
3,759 |
15 |
HILTON |
3,206 |
9 |
IBIS |
2,632 |
19 |
MOVENPICK |
2,182 |
12 |
NOVOTEL |
2,037 |
12 |
INTERCONTINENTAL |
2,010 |
6 |
ONOMO |
1,579 |
13 |
PARK INN |
1,498 |
9 |
KEMPINSKI |
1,371 |
6 |
MARRIOTT |
1,250 |
Not available |
ROOMS
HOTELS
Source : W Hospitality , Lagos