International leisure market lifts Cape Town’s hotels
STR Global survey shows the Mother City’s hotels continue to experience strong growth in occupancy and rate levels
Cape Town’s hotels continue to be buoyed by its status as an extremely popular tourist destination.
Latest hotel figures released by STR Global for the year to December 2016 showed that Cape Town hotels continued to experience strong growth in occupancy and rate levels, demonstrating resilience to the country’s broader economic challenges, HTI Consulting CEO Wayne Troughton said.
"Airlift to Cape Town also increased significantly in 2016. The Cape Town Air Access Initiative, a partnership between government, Airports Company SA, Wesgro and airline industries, successfully delivered over 400,000 additional two-way direct seats through route establishment and expansion. An estimated 78% of these new seats were added in 2016. The resultant impact was a 29% increase in international visitor arrivals at Cape Town International Airport (CTIA) for December 2016 when compared to December 2015," said Troughton.
The above has had a positive knock-on effect for hotel demand in Cape Town. During the year, the city’s occupancy and rates were consistently up on those of 2015.
Nationally, occupancy remained the same in December 2016 compared with the previous December, the national YTD occupancy increased by 2.5 % and average daily rates (ADR) by 8,7%, while revenue per available room (rev par) increased 11.4%.
"A large proportion of this growth was driven by a buoyant Cape Town market where 2016 annual occupancy grew 6.5% and is now sitting at 71.1%), and ADR and rev par increased by 13% and 20.4% respectively. All of the sectors finished positively, however, the five-star sector recorded the most significant growth, with STR reporting a 23.8% growth in rev par for 2016," said Troughton.
Comparatively, Sandton did not enjoy the same growth, in fact, occupancy was down two percentage points year on year to 63.4%. It also showed a slightly decline in December.
"The benefit for Cape Town hotels lies in the strong growth from the international leisure market, which complements existing convention, domestic leisure and business tourism. This makes Cape Town’s hospitality environment more resilient and gives hoteliers the benefit of a more diverse market base from which to draw demand," said Troughton.
In 2017, about 1,000 rooms are scheduled to enter the Cape Town market. Among these are the 500-key Tsogo Sun developments, 217-key Triangle House hotel and the 252-key Radisson Red.