Nairobi’s status as a conference and business travel hub has attracted six new top-end hotels, promising to add 800 beds to the circuit that has been grappling with limited capacity.
Hemingways Collection, SAMCO Holdings, Simba Group, Rezidor Group of Hotels, and the Red Cross are some of the investors who are putting up new properties that would add at least 800 beds into the market.
The new hotels are looking to cash in on the growth in the tourism that has led to an increased demand for bed capacity in the city, mainly driven by conference and business.
“The demand is high in Nairobi,” said Mr Mike Macharia, the chief executive of Kenya Association of Hotel Keepers and Caterers. “The increased capacity is welcomed, especially in the three to five star qualities.”
Investors in the sector are targeting conference and business travellers as well as leisure tourists who come into the country via Nairobi on their way to other tourist destinations.
Nairobi has become a major hub in the region connected by international airlines. Multinationals have in the past couple of years shown interest in the city setting up offices in Nairobi, raising its profile as a major business destination.
Business travel accounts for about 20 per cent of all arrivals in the country, second to leisure, which contributes 55 per cent.
Kenya Tourist Board statistics show the number of visitors increased by 32 per cent to 549,083 in the first-half of the year.
Earnings grew by 32 per cent during this period to Sh40.5 billion.
This year is expected to be the best for the sector despite the current security fears that has seen an international conference cancelled.
The new facilities are expected to increase competition in the market, even though players say there is enough demand to sustain the new properties. The current occupancy hotel rate in the city ranges between 60 and 80 per cent, said Mr Macharia.
“Nairobi still has room for more.”
The EKA Hotels, by SAMCO Holdings, will put into the market 170 rooms in February 2012 and four conference rooms.
The property, which is betting on its location on Mombasa Road to attract business, seeks to tap local conference market and business travellers.
Mr Charles Kikuvi, the EKA Hotel’s sales and marketing manager, said that conference business is expected to account for about 50 per cent of its business. The hotel also targets leisure travellers on a one-day stop in the city.
“Demand is increasing as the city grows,” he told the Business Daily at the hotel’s construction site.
The Belgium based Rezidor Hotel Group is expected to open the five star Radisson Blu in Upper Hill early 2013, according to its website. The hotel, which is owned by Elgon Road Development, will put in the market about 240 rooms.
Rezidor this year signed an agreement with AMS Hotels to build a 126-bed boutique hotel in Westlands.
The Park Inn by Raddison is expected to open its doors towards the end of 2013.
“Our business is managing hotels.
In line with our strategy over the past 10 years, we have completely divested ourselves of real estate and own no properties,” said Mr Andrew McLachlan, the Rezidor’s business development vice president for Africa and Indian Ocean Islands, earlier in the year.
Hemingways Collection, whose property in Karen is expected to open in August next year, and will add 45 luxury suites in the market.
The company, which owns other luxury properties across the country, is looking to add the city unit to its circuit.
Stream of income
In 2008, the Red Cross opened up Red Court Hotel to boost its stream of income and is looking at opening a second unit, The Boma, in the next few of months. The property will have 148 beds.
Simba Group, which is expanding its business into the hospitality industry, is set to invest no less than Sh2 billion in a five-star flagship property of about 200 rooms.
The hotel, on Chiromo Road, is expected to open in the first quarter of next year.
Currently, the key players in the city’s hotel industry are Intercontinental Hotel, Fairmont Norfolk Hotel, Nairobi Serena Hotel, Hilton Hotel, Safari Park Hotel, Windsor, Laico Regency, Sarova Stanley, Holiday Inn, Nairobi Safari Club, Sarova Panafric and Panari Hotel. With the newer ones: Tribe, Sankara, Ole Sereni, and Crowne Plaza already recording growth in business.