Durban is the only Commonwealth country city that agreed to play host to the 2022 Commonwealth Games. Preparations have started with the announcement of many commercial projects. Durban hotel performance was more or less in line with that of the other two South African cities we are covering with growth in both occupancy and ADR.
Hotel values in South Africa rose impressively in 2015 in Rand terms, due to a steady increase in revenue per available room. However, in dollar terms the country has not done so well, with a 16% drop in value for Johannesburg and Durban in 2015. Cape Town bucked the trend with only a marginal decrease in US$ terms. This performance is consistent with the currency crisis that was evident throughout all the emerging market economies.
Durban is still a growing market with strong occupancy growth combined with a 12% increase in ADR in 2016 will lead to an 18.7% REVPAR increase. With a low amount of supply coming in and a growing demand, the hotels' performance is expected to keep growing at a steady pace. In line with the two big other South African cities, Durban benefit from the exchange rate and the increase in value is 29% in 2016.