T
TOURISM
Cape Town’ s Hospitality Industry Booms
Investors in for a treat
he face of Cape Town’ s hospitality sector has transformed almost completely in the last few years, and as international tourism in the province thrives, the industry is poised for further growth.
The city out-performed that of Vancouver and Tokyo when it was named the World’ s Best City by the 2017 Telegraph Travel Awards in December. And despite tough economic times, according to data released by SA Tourism in July last year( 2017), the Western Cape attracted 1.5 million foreign tourists in 2016, who spent roughly R18 billion in the province, contributing largely to economic growth.
Leon Meyer, General Manager of the Westin Cape Town, a hotel at the Cape Town International Convention Centre( CTICC) precinct says the hotel industry in Cape Town’ s CBD is“ vibrant and healthy” and has enjoyed continued growth in the last few years, largely due to the city’ s reputation as a preferred tourist destination.
However, transforming the industry has taken a lot of hard work, and out-of-the-box, innovative thinking to attract new guests and retain existing ones. Likewise for Marriott International of which the hotel group Westin Cape Town is a part of, Meyer says adapting has been priority, especially with the upsurge in technology globally. He says introducing loyalty programmes was one way of doing this, and is of“ great importance” for the group and to demonstrate the hotel’ s commitment to its guests.
In the Mother City, specifically, tourism is booming. In 2016 alone Cape Town International Airport reported that 10 million passengers entered the province, the highest number ever recorded. To keep up with the amount of tourists entering the Mother City, the past few months have seen several new hotel developments opening in the CBD alone, including the Tsogo Sun Stay Easy and Sun Square, and the Radisson Blu Hotel and Residence in the CBD. A prominent new development is the Silo District of the V & A Waterfront, including the Radisson Red and Silo Hotel.
“ The city is booming, we have people coming here from all over the world to enjoy what our city has to offer. The Western
Over in Johannesburg, the Mayor’ s fixing up of the inner city has given rise to an excellent opportunity for investors. Street and pedestalian improvements will link the new Metro Mayoral Chambers to the Gautrain’ s Station terminus, Constitution Hill, and Wits Univesity.
Protea Hotel by Marriott Parktonian sits at the centre of these improvements. Investors should look at the Parktonian Sectional title scheme. Units go for under a million in an established Marriott franchised hotel, the world’ s largest hotel group.
New-build hotel investment units are advertised from R4.4 million at The Houghton, adjacent to the Golf Course, with a Leading Hotels of the World badge.
BUSINESS TOURISM IN THE MOTHER CITY
According to Wesgro CEO, Tim Harris,“ Business tourism is an important component of the Western Cape’ s economy. Not only does it bring in delegates from around the world who will spend money in our province, it also contributes significantly to the knowledge economy. This has an important impact on the investment potential of our region, as influential individuals, with important networks, are able to experience the diversity of opportunities on offer in the Cape.”
In May 2017, it was announced that Cape Town has been ranked the number one city in Africa for business tourism by the International Congress and Convention Association( ICCA). This saw the city rank in the top 40 destinations in the world, a 15-place improvement from the year before.
Cape on the whole has been placed on the global forefront with several awards and it’ s been highly beneficial for the industry,” he says.
Several new developments are on the cards, including the Marriott Hotel Foreshore and the Marriott Residence Inn, Meyer says both are expected to help restore the“ previously neglected” Foreshore, boost the local economy, and in-turn grow tourism numbers in the province further.
“ Both these hotels will become two of the city’ s largest developments in recent years, and they’ re expected to give the Foreshore a much-needed boost. The hotels will be open for locals and tourists, which will do even better for our economy,” Meyer says.
According to Michele de Witt, SA director for Horwath HTL – an international hotel consulting organisation, instrumental in growing the sector among English-speaking sub-Saharan Africa- Cape Town CBD is flourishing. De Witt says more foreign investors are choosing to invest in the Mother City, specifically as the city is different to other CBDs in the country. Cape Town CBD has maintained its appeal as a place to“ live, work and play” and the province provides potential investors with a robust and relatively diversified economy in which to do business.
“ Cape Town is often on a world traveller’ s bucket list as a must-see destination. The city’ s desirability is further enhanced by its proximity to iconic attractions in and around the city, many of which have their own highly acclaimed reputation,” de Witt says.
According to a recent report by the World Travel and Tourism Council( WTTC), Cape Town’ s tourism revenue relies on both business and leisure visitors. 7.5 % of GDP was generated by travel in tourism in 2016, with figures showing consistent growth over the past decade. The report also finds that one in nine people in the city are employed in the travel and tourism sector, as compared to 1 in 22 in the country as a whole.
These figures, along with the numerous hotels being developed in the city, point to a thriving tourism sector that offers savvy investors an ideal opportunity.
42 FEBRUARY 2018 SA Real Estate Investor Magazine