PRODUCT NEWS
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| Nairobi's resilient hotel sector to recover from terrorism and political controversy |
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| 18 Jun 2014 . BY Helen Andrews |
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| The 256-bedroom Radisson Blu is one of the new-builds set to open in Nairobi in the next 18 months / Radisson Blu |
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Nairobi’s hotel sector has demonstrated unprecedented resilience in the wake of a turbulent 18 months and is expected to reach its true potential during an upcoming period of political and economic stability, according to a report.
Global consultancy HVS has published a report which says a period of calm in the Kenyan city will allow its tourism industry and hospitality sector to recover from political and economic controversies.
HVS highlighted key factors that affected the Nairobi’s tourism market over the last year. Bombings in the capital and Mombasa forced UK holiday companies to cancel flights to Kenya until the end of October – depriving the transit point city of a share of its five million arrivals a year.
The siege of the Westgate Shopping Mall in September 2013 made headlines around the world, following a controversial presidential election in March 2013. These added to the nervousness of potential tourist and business visitors, according to HVS.
The consultancy reported that hotel occupancy for the year dropped 6.7 per cent in 2013 and revenue per available room (RevPAR) fell 6.8 per cent.
“Terrorism had a minimal and only an immediate impact on the performance of the market. Of more consequence was the election,” commented report author Tim Smith, director of HVS. “If the authorities can control the threat of attack and improve actual safety and potential visitor’s perceived safety, the fundamentals are there for the market to grow.”
Dubbed the safari capital of Africa, Nairobi is set to see a high volume of new-build properties open for business over the next 18 months, according to HVS. These include the 256-bedroom Radisson Blu and the 196-key Grand Sapphire – both of which are due to open in 2015. HVS estimates some 1,123 rooms are under construction, with further hotels to open at the reconstructed and modernised airport.
“It will take a number of years for this new supply to be absorbed, but if the economic and population growth forecasts prove accurate, the demand will quickly meet supply,” added Smith.
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