Africa’s hospitality sector is hitting its stride. International arrivals are climbing, infrastructure is expanding, and the industry is on track to generate $30bn by 2028.
Hotels alone will jump from $11.29bn in 2025 to $15bn by 2029 — a 7.35% compound annual growth rate that leaves most global markets behind.
The catch, however, is that infrastructure gaps, political volatility, and financing headaches still dog operators. Yet a 13.3% surge in hotel projects last year shows investors are betting on fundamentals, not fretting over obstacles.
Partnership play
Radisson Hotel Group is chasing 150 properties across Africa and plans to double its South African footprint to 26 hotels by 2030.
“Developers often assume we own the bricks and mortar,” says Daniel Trappler, the group’s senior director of Development for Southern and Eastern Africa. “We manage hotels on behalf of owners, bringing international standards, profitability, and global distribution.”
The model works with 65% of the company’s partners now owning multiple properties with the group. For investors, it’s a way into hospitality without the operational headaches.
Money talks
Hotel financing across Africa is a tale of two markets. Tanzania’s pension funds write equity cheques for entire projects, while SA’s $1.42bn market, growing at 4.43% annually, requires complex deal-making with banks, private investors, and development finance institutions.
“We help developers structure feasibility studies that credit committees actually approve,” Trappler says.
New models are emerging, too. Sectional title sales let individual investors buy rooms that operators pool and manage. Serviced apartments offer residential style returns with hotel flexibility.
The timeline problem, unfortunately, persists. “African hotels take five to seven years from signing to opening, vs 24 to 36 months in Europe,” says Ramsay Rankoussi, Radisson Hotel Group’s regional chief development officer.
His fix is conversions. “We opened over 1,000 rooms last year just by reflagging existing properties. It’s faster and less risky than building from scratch.”
The Covid-19 reset
The pandemic exposed African hospitality’s overdependence on international tourists while revealing hidden local demand.
“We discovered significant intraregional travel, especially from neighbouring countries,” Rankoussi says. “Domestic markets had been ignored.”
Africa’s face-to-face business culture is also reshaping properties. Hotels aren’t just beds any more; they’re economic hubs where deals get done and communities connect.
Lessons from SA
Despite currency swings and governance issues, SA remains the group's testing ground. Its sophisticated market and diverse demand make it ideal for experimentation.
“We trial lifestyle concepts in Johannesburg, convention centres in Middelburg, repositioned luxury in Cape Town,” says Trappler. “What works here, we roll out continent-wide.”
Playing the long game
In African hospitality, flexibility beats formula. “Currency weakness brings international travellers with buying power. When one market stumbles, another surges,” Rankoussi says. “We adjust constantly; that’s our edge.”
Problem-solving is equally pragmatic. “We dig into where owners struggle, whether it’s construction, funding, operations, and find solutions,” says Trappler. “That philosophy opens even the toughest markets.”
For investors eyeing African hospitality, they require patience, partnerships, and adaptability. Those who embrace the complexity might just find themselves leading the continent’s next growth story.
This article was sponsored by Radisson Hotel Group.
