Report: Where to Invest in Africa

JOHANNESBURG, SOUTH AFRICA—Wayne Troughton of HTI Consulting has shared insights on the top and bottom hospitality investment markets in Africa ahead of the 10th annual African Property Investment (API) Summit here on October 2 and 3.

According to Troughton, the hospitality sector continues to attract investment from a broad spectrum of international and African investors. “We are tracking investment from structured funds, predominantly from Europe and the Middle East—an increasing percentage of high net worth individuals (HNWIs) from Europe, Middle East and Africa itself, owner operators that invest from Europe, Africa and the U.S., as well as family offices [in the] Middle East, the U.K., Europe and South America.”

The most popular investment opportunity at the moment includes midscale urban hotel assets of 150 rooms, which are located close to corporations, conference centers and transport nodes.

West Africa

Currently, the most attractive markets are Cape Verde, Senegal, Benin and Ghana. While other markets provide opportunity, the possibility of security or political unrest can hamper performance and cashflows for long periods. According to Troughton, the top investment hospitality markets in West Africa are Abidjan, Côte d’Ivoire; Dakar, Senegal; Cape Verde; and Accra, Ghana, while the bottom five are Bamako, Mali; Niamey, Niger; Ouagadougou, Burkina Faso; and Conakry, Guinea.

East Africa

In East Africa, the top investment hospitality markets are Kampala, Uganda; Addis Ababa, Ethiopia; and Dar es Salaam, Tanzania, while the bottom are Nairobi, Kenya (over supply); and Kigali, Rwanda (over supply and limited demand).

Addis Ababa

With the current highest ADRs on the continent, Addis Ababa is touted as an attractive option, but Troughton cautions that the market remains challenging due to a lack of forex, which is resulting in developers battling to complete their hotel developments. However, he noted that if a developer has the proper and adequate financial backing and the correct project team to get a half-completed development finalized, then the “opportunity is there,” he adds.

Dar es Salaam

A market with plenty of opportunity, the city has performance challenges in recent years due to a lack of direction in policy for the private sector, increased supply in the CBD node and reduced levels of demand. While the CBD node is experiencing occupancy and ADR pressure, the outlook on the peninsula is more optimistic.


As one of the next hubs for investment, and with oil prices entering a recovery period, Kampala’s current limited branded supply helps the city provide a “strategic and attractive opportunity for investors,” said Troughton.


If an investor is able to buy an unbranded hotel in Kigali and adequately convert into an international brand then there is upside if well located. While the government in Rwanda remains proactive in attracting investment, and high economic growth is projected, the growth is off a low base and demand volumes for the city remain limited when compared to other East African cities, according to Troughton.