Some stakeholders in the Nigerian tourism and hospitality sector have queried the recent report that Nigeria is leading other African countries in the hotel chain development pipeline across the continent.
According to W Hospitality Group’s recent survey published ahead of the African Hotel Investment Forum (AHIF), Nigeria leads the Top 10 Countries by Number of Rooms in the Hotel Chain Development Pipelines in Africa 2016.
The report shows that about 10,222 rooms, courtesy of 61 hotels chains are in the pipeline in Nigeria.
However, some of the stakeholders argue that many of the 10,222 expected rooms are in the hotel projects abandoned for years, while some are being considered for redevelopment for real estate. For them, sieving the number to those that are truly under construction and with a deadline for opening, will ensure accuracy and direct would-be investors and economic planners in the right part.
“At the Murtala Mohammed International Airport alone, we have a supposed Hilton by the terminal that is abandoned for over 15 years, Crown Plaza by Bi Courtney at the airport is very much uncompleted for years now, as well, Hilton on Airport Road is abandoned since the ground breaking ceremony by Aero Marine (West Africa) Limited and Hilton Hotels and Resorts in 2011, while Starwood’s Luxury Collection Brand has been under construction for years at Ikoyi.
So, these hotels are not in the pipeline”, Imode Agya, hotel owner, noted. Agya noted further that with the current economic downturn, very high bank interest rates, and fast depreciating naira, it is very difficult sourcing funds within and outside, and the situation may warrant hotel developers to forever abandon the projects or sell their equity to pay bank debts.
“If a hotel project is still under construction for 10 years, then it is a white elephant project that may not be completed again. So, you have to be sure of the status of the hotel project before listing it among those in the pipeline”, he said.
Beyond Lagos, over eight more hotel projects are abandoned for years across the country.
A hotel developer is even considering converting a project in Calabar to hostel for students, as advised by his financial consultant.
Also speaking on the issue, Ikechi Uko, CEO, Akwaaba Africa Travel Market, noted that distinguishing between hotel projects that are truly in the pipeline and those abandoned for years and may likely not be completed, is necessarily for a clear picture of the hotel boom, direct hotel investors aright and also set right the figures for economic projection.
Differing, Jimi Alade, a hospitality expert, noted that hotel projects under construction would definitely come on stream because of the clamour for hotel investment in West Africa and Nigeria in particular, by foreign investors who are enticed by the huge return on investments and convenient tax system.
But Alade warns that the longer a project takes, the more it takes a toll on the developers who at some point may not have the funding to complete it.
The development for him, calls for the need for government and its agencies and the private sector to collate data that can always be cross-checked to ensure that figures and facts are right.
EMELIKE OBINNA
