Hospitality Sector to Recover by 2024

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The future is looking up for the hospitality industry with the sector expected to fully recover by 2024.

According to CBK, the hospitality sector was expected to hit a circa 5% growth in 2022.

The Tourism Research Institute reported that the number of tourist arrivals, as of November 2022, had surged by 74.5% compared to a similar period in 2021 – highlighting continued recovery in this sector that was amongst the hardest hit sectors during the Covid period.

This improved performance is nevertheless below 2019 levels, the best hospitality year Kenya has ever experienced.

 The Kenya Tourism Board stated that the hospitality sector is circa 70% recovered from Covid-19 pandemic and it expects full recovery by 2024.

The performance of the tourism industry is a result of the opening up of international travels as air travel restrictions ease amongst nations.

In Kenya, the second half, especially the fourth quarter of a year traditionally experiences a surge in demand for hospitality services as schools break, and employees go for holidays over the festive season.

Through the Market Perception Report by CBK for the month of November, there were increased forward bookings for the months of November and December as well as 2023’s January and February.

This is attributed to economic recovery from the Covid 19 pandemic and resumption of international travel.

The chart below shows that 2022 has been a favourable year for the hospitality sector as the economy fully recovers from the Covid-19 period.

In December Hilton exited the Nairobi CBD after 53 years of serving the city customers from its landmark building.

The hotelier, however, opened their newest outlet ‘dubbed Kwetu Nairobi’ under the Hilton Curio Collection, located at the junction of Peponi Road and Kitisuru Road, near Westlands.

The new hotel has a 100-bed capacity. Intercontinental Hotels Group (IHG) expanded their operations by opening a new outlet under their Holiday Inn brand at Two Rivers mall.

The Momentum Africa Real Estate Fund (MAREF) and Eris Property Group Limited are at the inceptive stage of developing a 162-bed capacity serviced apartment complex in Runda Riviera. The development will be managed by Singaporean real estate giants, Ascott, and will be named ‘Somerset Rosslyn’. Having 211 rooms, Glee Hotel is a 5-star facility expected to enter the market in H1 2023.

This property is located along Northern Bypass, near the junction between Northern Bypass and Kiambu Road.

Global luxurious hotel leader, JW Marriot, is expected to launch its iconic destination in Westlands, on the imposing Global Trade Centre Tower (GTC), in Q4 2023.

GTC is by far the tallest skyscraper in East Africa and JW Marriot will complete the work, live, shop and recreate design concept of modern urban communities.

Upon opening, the 5-star hotel will boast 317 guestrooms and 51 serviced apartments. Six Eighty, a three-star 340 room hotel, at the heart of Nairobi’s CBD, was disposed off to Maanzoni Lodges, a hospitality company that runs the Maanzoni brand.

The consideration for the 3-star rated hotel was reported as circa KES 1 billion.