By Alex C
With Nigeria’s hospitality industry soaring in the number of hotel rooms in the next five years, rising from 8, 400 in 2013 to 24, 000, in 2018, the sector gears up to impact Nigeria’s economy through corresponding revenue.
The projected growth would see overall hotel room revenue expanding at a 22.6 percent compound annual rate to $1.1 billion in 2018 from $413 million in 2013, according to the 4th edition of the ‘Hospitality Outlook’ report by PricewaterhouseCoopers (PwC),
The report disclosed that the expected growth was based on Nigeria’s booming economy, buoyed in part by regional and international investment in the hospitality industry. This is expected to grow hotel room revenue to 59 percent between 2009 and 2013.
The forecast comes despite the hotel sector in Nigeria growing by 9 percent in 2013, the smallest gain since 2010 with stay unit nights increasing by 6.3 percent in 2013. However, average room rates have risen by only 2.5 percent in 2013, quite grown slowly in the last two years.
On the growth of Africa’s hospitality sector in the next five years, Nikki Forster, PwC Leader of Hospitality and Gaming, says: “Growth in travel and tourism is expected to fuel growth in the accommodation industry across the African continent during the next five years.”
While the number of hotel rooms in Nigeria is projected to rise from 8, 400 in 2013 to 24, 000 in 2018, the country is still far behind South Africa.
Analysts believe Nigeria should learn from South Africa, where tourism is considered as a key element in the economy and is recognised in the National Development Plan as an important driver of economic and employment growth.
The anticipated growth would see over 50 international branded hotels across Nigeria. Though ushering more rooms in the hotel market is expected to reduce room rates, many hospitality experts anticipate room rates may be higher in 2018 despite the many rooms, due to increasing operational costs.
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