Posts by: tshepo

AC Hotels by Marriott opens first hotel in Middle East and Africa in South Africa’s Mother City

By on Dec 5, 2018

188 room AC Hotel Cape Town Waterfront celebrates the brand’s European soul and Spanish roots with classic modern design

DUBAI, United Arab Emirates, December 5, 2018/ — AC Hotels by Marriott (ACHotels.Marriott.com), Marriott International’s (www.Marriott.com) European-inspired lifestyle brand, today announced the opening of AC Hotel Cape Town Waterfront marking the debut of the brand in Middle East and Africa. Owned and developed by the Amdec Group, the hotel demonstrates the sophisticated and timeless European design that is true to the AC Hotel brand, interpreted for its Cape Town location. Conveniently located just minutes away from the buzzing Victoria & Alfred Waterfront, the hotel is just a 25-minute drive from Cape Town International Airport within the city’s thriving central business district.

“We are delighted to open our very first AC Hotel by Marriott in Middle East and Africa in Cape Town, further strengthening our long-standing partnership with the Amdec Group” said Alex Kyriakidis President and Managing Director Middle East and Africa Marriott International. “The opening of this hotel reinforces our commitment to driving growth for our lifestyle brands in South Africa in response to a continued demand from discerning travelers seeking hotels with style and functional design, while also providing unique and authentic experiences.”

Commenting on the announcement, James Wilson, Amdec Group CEO says: “We are proud to pave the way for Marriott International’s growth plans in South Africa and help to open up new markets for the world’s leading hotel company and its many loyal guests from around the globe. The Yacht Club mixed use development, where the AC Hotels by Marriott is situated, is the second property in our portfolio of iconic precincts to welcome Marriott, with Melrose Arch in Johannesburg being the first, and Harbour Arch in Cape Town, to follow.  We are thrilled with the opening of AC Hotel Cape Town Waterfront and believe it will provide another great place for international tourists to stay when visiting the city. It is exciting to be part of creating new dimensions for hospitality and tourism in the country and, by doing so, provide more opportunities for visitors and locals alike.”

With 188 spacious and stylish yet efficiently designed rooms that boast unparalleled views of the imposing Table Mountain, Lion’s Head and Signal Hill, AC Hotel Cape Town Waterfront introduces a “new way to hotel” to the dynamic city of Cape Town. The hotel houses the signature AC Lounge, a creative hotspot by day and social hub by night that serves local craft and as well as expertly made signature beverages. Guests can savor the brand’s Spanish roots with delectable tapas from fresh and locally sourced ingredients at the AC Kitchen or have a quick bite at the AC Market, offering convenient grab and go.

Other features include the AC Library, a quiet space lined with interesting and ever-evolving reading material tucked away from the buzz as well as a fitness center with state-of-the-art equipment. Located within walking distance from the Cape Town International Convention Centre, it also features four flexible meeting rooms and a boardroom with a total of 250 sqm of event space, boasting natural light and stunning Harbour views.

“With the Spanish heritage of the AC Hotels by Marriott brand, our design-driven hotel brings new inspiration to the city,” said Michael Liffmann, General Manager of AC Hotels Cape Town Waterfront. “We provide everything essential you need – and nothing you don’t – creating a seamless, tranquil and frictionless experience for our guests, whether they’re traveling for business or leisure.”

The hotel’s green status also sets it apart from other establishments in the Mother City. Some of its green initiatives include: a desalination plant; population sensor lighting to save power; heat pumps to supply hot water, eliminating the use of heat elements, as well as biodegradable straws and packaging. “In the age in which we live, we simply cannot ignore that our precious natural resources are being depleted faster and faster, before we’re even able to identify replacements or alternative methods. At AC Hotel Cape Town Waterfront, we are committed to introducing green initiatives to help save our planet and conserve it for future generations,” added Liffmann.

AC Hotel Cape Town Waterfront is a significant addition to Marriott International’s fast-growing portfolio in South Africa. Protea Hotels by Marriott, Marriott Hotels, Autograph Collection, Westin and Sheraton are some of the other brands that are currently present in the country today.

Distributed by APO Group on behalf of Marriott International, Inc.

 

Hilton Opens US$100m Society Business Park In Zambia

By on Sep 8, 2018

Hilton has opened the newly refurbished development Society Business Park on Cairo Road in Lusaka, Zambia.  The 20-floor mixed-use park, which also houses Hilton Garden Inn, was part of a public-private partnership agreement between Zambia National Building Society (ZNBS) and the National Pension Scheme Authority (NAPSA) in 2011.

The agreement between the two is a 20-year procurement partnership for the US$100m redevelopment of the park, which its management was subsequently awarded to Hilton to open the Hilton Garden Inn as part of the development.

Panoramic views of the capital

With 148 guest rooms, the hotel offers its guests panoramic views of the capital, including four junior suites with kitchenettes on the 18th floor. It also has an all-day dining restaurant catering to both leisure and business travelers. The hotel also features contemporary indoor and outdoor spaces, including 1,600 square feet of banquet space and pre-function areas.

General manager Kudzayi Nheweyembwa said the hotel is strategically situated as it is in close proximity to numerous restaurants, shops and offices. Other features include an outdoor pool, and a 24-hour fitness centre.

“We are in close proximity to numerous restaurants, shops and offices so both leisure and business travelers will be met with a stay tailored to their needs and we look forward to welcoming them with our bright and happy service,” he said.

Great potential for tourism

Hilton vice-president for Africa and the Indian Ocean, Mr. Jan van der Putten on his part said the hotel had great potential in promoting tourism and business. “I am confident that Hilton Garden Inn Lusaka Society Business Park will contribute to the growth of the tourism sector as well as create employment opportunities. What we are witnessing today is part of our strategic five-year expansion plan for Africa,” he said.

Zambia’s Minister of Labour and Social Security Joyce Nonde-Simukoko said Hilton’s investment demonstrated confidence in the Zambian market.

“This investment has transformed the outlook of Lusaka’s central business district by adding the much needed modernity to infrastructure. It is my government’s wish that other property owners in the central business district will be motivated to give a face lift to their buildings,” she said.

The hotel is the second Hilton Garden Inn property to open in sub-Saharan Africa this year and joins 42 existing Hilton properties in Africa.

Hapag-Lloyd Invests In Growing East African Market

By on Aug 17, 2018

HAMBURG, Germany, August 17, 2018/ —
  • Kenya as a driver of growth in the East Africa region
  • Serving nearly 900 export and import customers
  • Hapag-Lloyd with weekly service to and from Mombasa

Hapag-Lloyd (www.Hapag-Lloyd.com) is continuing to focus on the growing market in East Africa. With annual growth rates of approximately six percent, the region tops the list on the African continent. Kenya, in particular, is developing with significantly rising import and export figures as well as massive investments in public infrastructure.

In April 2018 Hapag-Lloyd launched the East Africa Service (EAS), its first dedicated service to East Africa. The weekly service sails from Jeddah to Mombasa, and from there to Dar es Salaam, in Tanzania, and directly back to Jeddah. After a successful start this service will be expanded in September with a weekly connection to and from Nhava Sheva, Mundra, Khor Fakkan, Jebel Ali, Mombasa and Dar es Salaam. The so called EAS2 will replace the current EAS service and directly link the Arabian Gulf and the West Coast of India with East Africa.

Hapag-Lloyd also offers inland transportation to and from East African hinterland locations of Bujumbura (Burundi), Kigali (Rwanda), Lubumbashi (Democratic Republic of Congo), Lusaka (Zambia) and Kampala (Uganda).

“I am delighted that our East Africa Service from and to Kenya is developing so positively. After only four months in operation, we have significantly expanded our business with overall vessel utilization beyond our expectations,” said Dheeraj Bhatia, Managing Director Africa, Middle East and Indian Subcontinent for Hapag-Lloyd AG. “With our upcoming new EAS2 service we will be able to offer even better connections from and to East Africa. All in all we are experiencing growing client demand which demonstrates the economic potential of Kenya.”

The GDP of Kenya has grown significantly in the last two years, rising by an average of approximately six percent. Kenya primarily exports coffee and tea, but also vegetables, fruits and textiles. The main imports are vehicles, spare parts, yarns, machines and electronic goods.

APO Group

LODGING MARKET OVERVIEW – LANSERIA INTERNATIONAL AIRPORT AREA, GAUTENG PROVINCE, SOUTH AFRICA

By on Jan 16, 2018

Introduction

The OR Tambo International Airport (ORTIA) is still by far the largest airport in South Africa, and regional airports such as Lanseria Airport (HLA) benefit greatly with feeder markets from international arrivals. Flights into HLA are convenient for most passengers due to its size which facilitates fast turnarounds, ample parking and access to major highways.

HLA is situated on the border between the North West and Gauteng Provinces. It is one of the most important regional airports in South Africa and it primarily serves the domestic passenger market and covers Cape Town, Durban and George. It is also favoured by the charter airline industry and covers many remote locations that are not served by the likes of the ORTIA. Many private companies and individuals also park their aircraft in the hangars located on the airport grounds.

HLA is owned by a consortium of investors, and the Lanseria Airport Development Company (LADC) was incorporated with a focus to expand the airport and to develop the extensive precinct. Support from Provincial, Local and Metropolitan authorities has also been forthcoming as the airport is seen as a major anchor for the development of a planned aerotropolis. Infrastructure projects such as airport expansions and their amenities create jobs both during construction and operational phases and are seen as an integral part of the planned mobility expansion project of the City of Johannesburg. Support has also been expressed from businesses with large planned projects.

Regional Economy of Gauteng Province  

Despite the relatively dry climate, Johannesburg, the capital city of the Gauteng Province, is still a strong competitor for local and foreign tourists into South Africa due to a relatively stable temperature profile throughout the year.  

The Gauteng regional economy places some significant reliance on HLA to facilitate its mobility. According to Gauteng Tourism, “Johannesburg is geographically fairly centrally located in South Africa, and as the biggest urban conurbation it’s also the largest transport hub – for local, cross-border and international travel”.

The City of Johannesburg Local Municipality is officially considered to have a population of 4,4 million. Johannesburg is the largest single metropolitan contributor to the national economic product. The city’s contribution is almost 16% to the national economy and 40% to the Gauteng province. Its economy is dominated by the financial and business services sector, the retail and wholesale sector, the community and social services sector and the manufacturing sector. These sectors are found in both the formal and informal economies, with the township areas accounting for the bulk of the informal economy.

The below chart illustrates regional GDP growth for the years 1997 to 2019. The trendline for the Gauteng economy is depicted in red.  

The outcome of the recent ANC Elective Conference has had a positive impact on the South African Rand. That, in combination with rising business confidence and a growing world economy, is seen as positive news for the local economy. This outlook however has to be read in line with the recent credit downgrades.   

Passenger Movement

In a past report IATA advised that global air passenger numbers are still set to double over the next 20 years, with an upside scenario growth average 5.8% through 2034 and produces 2.1 billion extra people.

Aviation in Africa has recently been given a major shake-up with the signing of the massively-delayed Yamoussoukro Decision at the end of 2017. This important milestone is meant to put into action the open skies policy for African airlines. The creation of a more competitive environment at Africa’s airports is widely seen as a major boost for the travel and tourism industry on the continent. It is perceived that HLA will benefit greatly from increased traffic.

According to the HLA CEO, Rampa Rammopo, the airport’s aim is to double its passenger numbers to more than 4 million within the next six years. HLA is South Africa’s fourth largest airport by passenger numbers among 21 significant local airports. Being in this position is a major feat considering that the airport is privately owned and relies primarily on the domestic market for its business. In 2006, HLA is said to have seen 100,000 passengers pass through its gates. This number has now risen to 1,9 million passengers and is growing in double digit percentages on an annual basis.

Lodging Market Segmentation

The Lanseria Aerotropolis lodging market consists primarily of a corporate segment, then followed by both group and individual leisure and MICE. Weddings are an important leisure activity in the greater area due to its serene and rural setting. The airport segment is rather small in line with the size of the HLA, however this is seen as a temporary situation because of all the planned expansion and the increased number of airlines that will come with this.

HLA’s rising popularity evolved as a result of corporate clients who were in need of a quick check-in and check-out process at the airport as they moved away from the larger and more elaborate ORTIA. This level of convenience is also extended at the various hotels, guesthouses, bed and breakfast and other lodging facilities that are to be found in the surrounding suburbs.

Individual and group Leisure segments are attracted to the abundant availability of tourism assets in the vicinity of HLA. The Cradle of Humankind and the Lion Park are world-famous destinations. Many wedding venues are to be found in the surrounding areas of the airport. A bit further out but still within easy reach is the Sun City Entertainment Complex. All these assets attract both domestic and international visitors all year round and the HLA helps to facilitate much of this business.

The MICE segment is amply provided for in this region due to the secluded profile of the properties found here together with ample recreational facilities, expansive grounds for team-building and central access.

Lodging Key Demand Areas

Lanseria Aerotropolis is surrounded by the Gauteng Province suburbs of Sandton, Randburg, Roodepoort, Krugersdorp, Magaliesburg and Centurion. The key demand areas comprise major residential, retail, commercial and industrial districts.

 Kya Sands, Lazer Park, Strijdom Park and Honeydew Industrial Townships are located in Randburg. These mature industrial townships have developed rapidly as an extension of Johannesburg as decentralised nodes. As Aerotropolis grew larger and became more relevant as a regional airport, new industrial parks have now been established. Lanseria Industrial Park and Cosmo City Business Park arose on the back of an expanding HLA. Since its establishment in 2006, Cosmo City Business Park has doubled its rate of vacant land take, now almost sold out. Stand development also tends to occur quite rapidly after a stand is sold out. These developments house distribution and warehousing companies and command high rentals.

Fourways and surroundings – This high value residential, retail and entertainment node is anchored by Montecasino and Entertainment Centre and Fourways Mall. Montecasino is always growing with new additions every year and brand new nodes every five years or so. These new nodes typically include entire office parks, retail and hotels.  

Fourways Mall is currently undergoing a major revamp with more than 20,000 square metres of additional shopping space. A sizable bulk of these shops are major international retail brands.

Dainfern and surroundings – Dainfern is essentially a residential golf park which grew to become a luxury node. Some of South Africa’s most expensive residences are known to change hands. It is popular with multinational expatriate executives who come to settle here.

Broadacres and surroundings – Broadacres is a pre-dominantly small-holding area which is fast developing into a high density residential environment. It is anchored by a community shopping centre and has access to Fourways and Sandton.  

Sun City – This world-famous entertainment and gambling hideaway is a short one and a half hour’s drive from Lanseria Airport.

Hartbeespoort – Hartbeespoort houses the largest dam in Gauteng Province. The town also supports much leisure activities over weekends and public holidays. Visitors come from far and wide to enjoy the various activities such as the newly-revamped cable car and water sports in the dam.

The Cradle of Humankind is a popular is perennially popular with both locals and foreigners because of its unique product offering and the operator’s focused marketing effort.

Lodging Source Markets

Lanseria Aerotropolis is essentially a business destination with a high domestic and continental guest component. Domestic source markets for hotels in the city include corporate travellers from Cape Town and Durban on scheduled Kulula, FlySafair and Mango flights, as well many chartered flights to far flung tourist destinations such as Kruger National Park and mining towns. Travellers arrive from all countries on the African continent. The previous Minister of Tourism, Derek Hanekom, has in the past announced that travellers in transit through Aerotropolis will no longer require transit visas, further cementing the airport’s reputation as a rapid transfer airport.

Lodging Properties and Indicative Room Rates

The Lanseria Aerotropolis lodging market comprises of only a few locally branded hotels, no global brands and numerous independent hotels and bed and breakfast establishments. Active brands include Tsogo Sun, aha and City Lodge Group. Surrounding hotels are situated at varying distances from the airport and all of them have great access to its facilities. The properties described in this paragraph are popular with business tourists due to their convenient location, attractive surroundings, affordable room rates and aesthetics.

Hertford Country Hotel, Shumba Valley Lodge and Kloofzicht Lodge are some of the more famous independently-owned assets and they cater for pilots, businesspeople, corporates, weddings and small conferences. Maropeng and Forum Homini Boutique Hotels cater for exclusive visitors to the Cradle of Humankind. Hotels at Montecasino, Indaba Hotel and City Lodge Fourways compete for the formal hotel client in the Greater Sandton and Randburg suburb. Rates at these properties are very competitive and much flexibility exists in pricing, a situation which can be attributed to their being privately owned and the largely independent operator profile.

Hotel prices change very rapidly on a daily, sometimes hourly basis. Through Google Maps, one can see the location of most of the properties that regularly advertise their price on the internet. In the study area, customers can rarely find a formal hotel room that is advertised at less than R1,200 per night. The bulk of the properties that are being advertised below that price are either guesthouses or bed and breakfast places. Formal hotels charge rack rates that are upwards of R1,500 the closer they are to the surrounding suburbs. At Montecasino in Fourways, the five-star Palazzo Hotel rack rate was advertised at R3,665 at the time this article was written. The Southern Sun was priced at R2,999 from R2,978 a few minutes earlier. On the other hand the City Lodge across the road was priced at R1,597. On the opposite end of the HLA, the aha Lesedi is advertising rack rates of just under R1,200.

Hotel Market Performance in South Africa

The average room occupancy rate of South African hotels is reported to be persistent in a range between 45% and 60% across all market positions. The branded properties tend to operate in the upper limit of this range. For most operators the key to profitability lies in how they manage their expenses while maintaining standards and still remain attractive to their guests.   

The rate of supply of hotel rooms in South Africa is in some ways regulated by the lending environment and the risk averse attitude of banks towards the funding of hotel investments. In line with that property developers have tended to staying away from hotel projects.     

The performance of the accommodation industry as measured by Statistics South Africa reveals a rising trend in revenue figures. Over the past 10 years room revenue has maintained a consistent upward trend despite tough economic conditions: “Measured in nominal terms (current prices), total income for the tourist accommodation industry increased by 1,2% in October 2017 compared with October 2016. Income from accommodation increased by 2,9% year-on-year in October 2017, the result of a 3,7% decrease in the number of stay unit nights sold and a 6,9% increase in the average income per stay unit night sold”.  

ACCOMMODATION REVENUE TREND 2012-2017

The accompanying graph from Statistics South Africa illustrates the accommodation industry’s room revenue trend during the period 2012 to 2017. Based on a perceived improving economic outlook, this rising trend is expected to remain over the next couple of years.

Room occupancy rate has remained bound in the 45% to 55% range over the same period. Whilst occupancies have been restrained, annual average room rates have maintained reasonable growth  

 

The Outlook For HLA

The outlook for the South African hotel industry is a positive one, following on increased confidence levels in business circles and the accompanying GDP growth outlook. This, in conjunction with demand for private  development in the area, government pledges  for large infrastructure projects such as new rail and water sanitation, is the setting that Lanseria aerotropolis needs to sustain a bustling hotel industry.

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For more information on the above and to learn more about our services please get in touch with us:

Makhudu Hospitality Consultants (Pty) Ltd.
Block D, Sweet Thorn on Beyers Office Park
2595 Bosbok Road,
Randpark Ridge, 2156
Gauteng Province,
SOUTH AFRICA

TEL: +2782 301 4572
CEL: +2787 238 2457
eMAIL: tshepo@makhudu.co.za
WEB: www.makhudu.co.za

COMPANY PROFILE MAKHUDU HOSPITALITY CONSULTANTS

We are a Hotel and Related Hospitality Property Consulting and Brokerage Services Company. We Pride Ourselves And Our Place through our dedication, our passion and our skill, all of which we bring to bear in serving our customer.  

The recent competitive entrance of global hotel operator chains in Africa over the last number of years has necessitated a rapid rise in new hotels. Because of that a related increase in the level of sophistication of hotel investors has created a need for a specialist consultancy service to meet to service the industry. Makhudu Hospitality Consultants (Pty) Ltd was established in 2017 to meet this need.

Over many years Tshepo Makhudu has amassed experience and knowledge of the hotel investment industry in South Africa and across the continent. He has held positions at leading consulting, real estate owning, banking institutions. Recently Tshepo has worked for a global hospitality development, management and investment consultancies in the world, where he was tasked with valuations, market and feasibility studies and consulting engagements in Africa.

Learnt skills include commerce and property development and management at leading universities in South Africa and executive leadership training in the USA. Tshepo is a founding Board Member of the South African Institute of Black Property Practitioners and in in 2015 he was bestowed the IsiThwalandwe Award for his contribution towards the transformation of the property industry in South Africa.