City Lodge expects further rise in occupancy despite slow economy

Posted On Wednesday, 19 August 2015 09:56 Published by
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City Lodge Hotels expects demand for its rooms to continue exceeding expectations in the year ahead after it increased occupancies in 2015.

Clifford Ross

City Lodge Hotels expects demand for its rooms to continue exceeding expectations in the year ahead after it increased occupancies in 2015 despite a sluggish economy in its home market compounded by labour unrest, power outages and a generally negative outlook.

SA’s third-largest hotelier, which increased revenue by 22.6% to R1.3bn in the year ended June, said on Friday the trend for better than prior year occupancies had already seeped into the first two months of the 2016 financial year. The R890m the South African hotelier is spending on increasing its footprint in SA and across the rest of the continent will also improve occupancy rates in the year ahead.

City Lodge said the 148-room hotel in Newtown and 90-room Road Lodge hotel in Pietermaritzburg were expected to open in the fourth quarter and be fully operational next year. It said that construction of hotels in Nairobi, Dar es Salaam and Windhoek were expected to be completed in the first quarter of 2017.

The company, with a market value of R6.2bn, expects to have finalised formal agreements for the development of hotels in Maputo and Kampala by the final quarter of this year or early next year.

“When these are bedded down we will be looking at Rwanda, Ethiopia, Zambia and Zimbabwe,” City Lodge CEO Clifford Ross said.

In the 2015 financial year, average occupancies in SA increased to 67% from 63% last year, even as economic growth in its biggest market faltered and business confidence weakened.

 

Last modified on Wednesday, 19 August 2015 11:47

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