Addis Ababa, Ethiopia Leads Africa in Hotel Room Rates as Country’s Hospitality Sector Posts Strong Performance

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Addis Ababa, the capital of Ethiopia, has seen its hospitality industry post Africa’s highest average daily rate (ADR). This is according to the most recent 12-month data from STR, a US-based company that tracks supply and demand data for multiple market sectors, including the global hotel industry.

The market will play host to the Africa Hotel Investment Forum (AHIF) on 23rd to 25th September at the Sheraton Addis, a luxury hotel.

ADR is a statistical unit that is often used in the hospitality industry. The number represents the average rental income per paid occupied room in a given time period.

From July 2018 through June 2019, Addis Ababa registered an absolute ADR of US$163.79 when measured in constant currency, which removes the effects of inflation. That figure was a 1.1% increase year over year. The next closest STR-defined markets in Africa were Accra Area, Ghana (US$160.34) and Lagos Area, Nigeria (US$132.51).

“Addis Ababa continues to maintain high ADR levels when compared internationally,” said Thomas Emanuel, a director for STR.

“The city has multiple demand drivers, such as a growing economy, successful airline and its status as the diplomatic capital for Africa. Air connections and ease of access compared with other cities also factor in the equation for strong demand, which provides hoteliers with the confidence to maintain rate levels,” he added.

Addis Ababa’s occupancy over the same 12-month time period was 58.4%, up 6.5% year over year. Cairo & Giza was the continent’s occupancy leader at 74.5%. Cape Town Centre, South Africa (65.0%), ranked second in the metric followed by Accra Area (59.7%).

“With healthy performance comes interest in investment. The market’s pipeline is strong with 22 hotels and 4,820 rooms in active development. We will continue to monitor these new openings to see how the market reacts once these additional rooms open,” Emanuel continued.

Emanuel will present the latest hotel performance and development insights on the Tuesday (24 September) of AHIF.

“Hosting high-profile international meetings like AHIF is one factor that has helped Addis to maintain its position as the city with the most expensive hotel accommodation in Africa,” said Matthew Weihs, Managing Director, Bench Events, the AHIF organiser.

“Our delegates will be looking carefully to see if the addition of a lot more high-quality accommodation and meeting space will depress room rates or help Addis become even more attractive as a destination,” he added.

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