Cape Town’s international tourist tally is charting new territory, lifting key performance indicators across the city’s hospitality sector to record highs.
Revenue per available room, a widely used metric to measure hotel profitability, climbed 21% year on year in the six months to June, according to new data from hotel analytics group CoStar.
Visitors to Cape Town now pay an average of R3,037 a night for a hotel room — the first time the average daily rate has breached R3,000. This rate is up 15.8% year on year and nearly double the average R1,647 fetched pre-Covid in 2019.
Occupancy rates in the city are also testing new highs. These came to 68.2% in the first half of 2025, up 4.6% year on year and ahead of the 65.8% recorded in 2019.
The recovery in Cape Town’s hotel and hospitality sector differs markedly from the rest of the country. Hotel revenues in other cities have recovered steadily from the pandemic slump in 2020/2021, but the national average daily rate still sits below R2,000.
Occupancy rates reflect a similar scenario, with the national average lagging Cape Town at 58.8%, which is down on the 61.7% achieved pre-Covid.
The improved fortunes of Cape Town’s hospitality sector are evident in the V&A Waterfront, which has 13 hotels with about 1,700 rooms.
V&A CEO David Green tells the FM the mixed-use precinct achieved an average hotel occupancy of 74.3% in the first half of 2025, up 4% year on year. Revenue per available room surged 27% over the same period, while the average daily rate rose 22% to R4,846.
Green says there is still room to add to the upper end of the hotel market, in particular. V&A owners Growthpoint Properties and the Public Investment Corp are investing about R2bn in a new 100-room hotel scheduled for completion in the first half of 2026. They are also refurbishing the five-star Table Bay Hotel (329 rooms), which will be rebranded as InterContinental Table Bay Cape Town.
The new hotel development will include six residential units.
Cape Town’s hotel sector has been buoyed by more foreign tourists since 2022. From January to June, a record-breaking 1,633,453 passengers (two-way) went through Cape Town airport’s international terminal, according to Wesgro. That represents a 5% year-on-year increase and comes off an already high base. Last year, the number of offshore passengers who clocked in at Cape Town’s airport reached 3-million for the first time, up from 2.8-million in 2023, 1.89-million in 2022, and well ahead of 2019’s 2.6-million.
Cape Town recently completed its longest and most successful cruise season. A total of 83 ships docked at the Cape Town cruise terminal in the nine months to the end of June. The ships brought 170,000 visitors to the city, up 6% from the 2023/2024 season. In March, a record 22 ships visited Cape Town. Wesgro CEO Wrenelle Stander says the 2023/2024 season generated R1.32bn for the regional economy and supported 2,000 jobs, underscoring the multiplier effect of cruise tourism and its growing importance to the Western Cape economy.
Easier visa applications are helping to make Cape Town a year-round destination
Cape Town’s rising prominence as an international tourist hotspot has been boosted by increased air capacity. Stander says several international airlines have extended their seasonal flight schedules to Cape Town this year, while others are increasing frequency. These include Air France; Dutch carrier KLM; Swiss carrier Edelweiss Air, which flies between Zurich and Cape Town; and Norse Atlantic Airways, which serves the Cape Town-London Gatwick route.
Easier visa applications are helping to make Cape Town a year-round destination, according to industry insiders. The digital nomad visa allows applicants to live and work remotely in South Africa for 36 months. The department of home affairs announced two new digital visa categories that will remove barriers to investment in the country’s creative economy, especially benefiting Cape Town’s film and events sector.
Grant Elliott, deputy chair of the Cape Town Central City Improvement District, says Cape Town’s growing appeal as a filming destination has already generated substantial economic spin-offs for the city’s hospitality industry — a trend set to accelerate under the new streamlined visa regime. In the city centre alone, about 550 production shoots have already taken place in the five months to the end of May, including several international commercial shoots, TV series and feature films.
International production teams often stay for a week or two at a time, says Elliott. “It’s not just a one-day affair — their extended stays create consistent demand for accommodation and other services.’’
He notes that there’s a huge demand for aparthotels with self-catering facilities in particular. “We’ve already seen a flattening of the traditional seasonal dips, particularly in winter months such as May to August, where our numbers are significantly higher than in the previous season.’’
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