Hospitality Outlook 2015 for South Africa

South Africa’s hospitality industry is prepared to grow further in the next five years, with most growth in the sector expected to be generated in Cape Town, according to a report released by PwC today.

Nikki Forster, Hospitality Industry Leader for PwC, Southern Africa says: “Although South Africa’s economy has weakened, the hotel industry in 2014 has benefited from an increase in foreign visitors and rising room rates.”

PwC’s 5th edition of the ‘Hospitality Outlook: 2015 – 2019’ projects that by the year 2019 the overall occupancy rate across all sectors in South Africa will continue to increase, rising to an estimated 58.3% from 54.4% in 2014. “The hotel occupancy rate reached its highest level in 2014 of 52.6% since 2008. The hotel occupancy rate is expected to increase to 62% by 2019 but still remain lower than the 68.4% achieved in 2008,” adds Forster. Five star hotels are expected to achieve a high of 80% occupancy in 2019.

However, one of the most significant recent developments in 2014 and 2015 in the South African tourism industry was the revision of the country’s visa regulations. “Under the revised regulations tourists to South Africa will have to apply in person for visas to visit South Africa so that biometric data can be reliably collected. In addition, parents and guardians travelling with minors must have an unabridged birth certificate that shows the names of both parents,” adds Forster.

Worldwide, governments are focusing on efforts to relax visa requirements to promote tourism. Tourism industry commentators in South Africa say the regulations have already adversely affected travel from China and India.

PwC’s report features information about hotel accommodation in Nigeria, Mauritius and Kenya. The accommodation sector in South Africa consists of hotels, guest houses and guest farms, game lodges, caravan sites, camping sites and other overnight accommodation.

Growth in room rates will be the main driver of revenue, with new hotels in Cape Town leading the expansion.

Source: eTN