Hotels expand in Kenya as business travel surges

NAIROBI Wed Sep 26, 2012 11:16am EDT

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NAIROBI (Reuters) - Some of the world's biggest hotel brands including Marriott, Hilton and Rezidor are planning to open hotels in Kenya to cash in on a surge in business travellers from China and the Middle East to east Africa's biggest economy.

Interest in Kenya from China and other new markets including India and the United Arab Emirates led to a 15 percent surge in visitors to the country to 1.26 million last year, accounting for about 80 percent of total bookings in Nairobi.

Kenya is racing to improve facilities to meet this growing demand, which has important economic implications - the sector generated foreign exchange earnings of 98 billion shillings last year, second only to tea.

Its main airport, the biggest in east Africa, is being expanded to double its capacity to over 4 million passengers.

Alex Kyriakidis, Marriott's president and managing director, Middle East and Africa, said he expected to sign a deal by the end of the year to open a hotel in Kenya by 2015.

"We believe investment in infrastructure in the airport and Nairobi looking to be a hub is very positive," Kyriakidis told Reuters at the Africa Hotel Investment Forum held in Kenya's capital, Nairobi.

Hotel operators at the Forum shrugged off concerns over violence that have in the past dented Kenya's tourism sector, including during the election in 2007.

"We have just gone through the Arab Spring in North Africa (and) all our hotels are absolutely fine," Kyriakidis said.

Besides Kenya, Marriott plans a total of about 5,000 rooms in Benin, Ethiopia, Ghana, Gabon, Nigeria and Rwanda by 2015, a $1.5 billion investment.

Hilton plans to open two new hotels in Nairobi and is looking to renovate and rebrand existing hotels on Kenya's coast, as well as venturing into Congo and Rwanda.

Rezidor will open two in Nairobi by 2014.

Africa has posted strong growth rates of about 5 percent in recent years, second only to Asia, drawing increased investment, according to World Bank estimates.

"Seven out of the 10 fastest (growing) economies are in sub-Sahara Africa. We would be crazy not to be focused in the sub-Saharan market," said Andrew McLachlan, vice president of business development Africa and India Ocean Islands at Carlson Rezidor. (Editing by James Macharia and David Holmes)

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