Carlson Rezidor counting on long occupancy in Africa

CARLSON Rezidor, the world’s 10th-largest hotel operator with more than 1 300 hotels in 110 countries, is doubling its African portfolio, banking on the continent’s long-term economic growth to fuel its future returns.

This will add to its portfolio of 34 hotels in 27 African countries, with South Africa and Nigeria as its keystone African territories. The company has also decided to base its regional office in Cape Town.

Marc Descrozaille, Carlson Rezidor’s area vice-president for Africa and the Indian Ocean, said managing the region from Cape Town followed from the company’s long-standing relationship with the city after its first hotel on the continent was opened at the V&A Waterfront 16 years ago.

Cape Town will soon boast Carlson Rezidor’s highest operation density for an African city, with four hotels and two more to follow next year.

“We decided to have Africans manage the African operations in reaching the critical mass we want on the continent.”

The office, which will be at the Waterfront — a site Descrozaille calls the best on the continent — will add to the company’s business-development complement with support functions such as marketing.

In South Africa and Nigeria, the company wants to reach a critical mass of 20 hotels.

“Elsewhere in Africa we don’t look at countries but more at cities — commercial hubs and capital cities like Nairobi and Abidjan where we can position our brands,” Descrozaille says.

“There’s a Quorvus Collection luxury hotel being developed in Lagos and we typically enter markets with the Radisson Blu brand.”

Descrozaille said traveller recognition of the Radisson Blu brand was high, hence its positioning as market-entry brand, but in nine months Cape Town will have a Radisson Red at the Waterfront, catering for younger guests who are happy to eschew formalities such as reception desks and instead check in online, using their mobile devices to access their rooms.

Even with most African economies struggling with a commodity slump, Descrozaille said Carlson Rezidor was in a race with other international brands to boost capacity. “We’re in this business for the long run. We typically open hotels that will be there for the next 60 years, if not longer.

“There are cycles in the industry and right now there is a need for more supply and goodquality rooms on the basis that there will be increases in infrastructure, and GDP growth will still be at a faster rate than in most other regions of the world next year.”

The company says that in Africa, in the past two years, it has signed a new hotel deal every 37 days and opened a hotel every 60 days.

Descrozaille said the group had noted an increase of intraAfrican travel: whereas a decade ago 10% of guests in its African hotels were from elsewhere in Africa, that proportion is now up to 30%. “The middle class is growing . . . Many of these markets are real emerging markets in the sense that supply is not there yet. Being first to enter gives us a competitive advantage.”

He said the company ran eight hotels in South Africa. Its most recent opening was in Durban.

Gillian Saunders, Grant Thornton’s global leader for travel, tourism and leisure, said Carlson Rezidor had done the best among global hotels in growing an African footprint.