African Sun in hotels upgrade

20 Nov, 2019 - 00:11 0 Views
African Sun in hotels upgrade

The Herald

Fradreck Gorwe Business Reporter
Zimbabwe Stock Exchange-listed hospitality concern, African Sun Limited, has embarked on an intensive refurbishment of most of its hotels countrywide at a cost of US$25 million in a move likely to boost occupancy levels.

In a statement accompanying the group’s trading update for the nine months and third quarter to September 30, 2019, management indicated the projects have already kicked off with refurbishment of Troutbeck Resort, Caribbea Bay Resort and Great Zimbabwe Hotel.

On the other hand, mock-up rooms for Hwange Safari Lodge and The Victoria Falls Hotel, currently undergoing construction shall be operational early 2020. Funding has, however, been the major hindrance to the desired pace of refurbishment of projects owing to the prescribed 30 days retention period.

“The group has taken an initiative to revamp its product offering through a number of refurbishment programmes for most of the hotels at an estimated cost of US$25 million.

“We have commenced the refurbishment of Troutbeck Resort, Caribbea Bay Resort and Great Zimbabwe Hotel albeit at a much slower pace as funding commitments and long term planning have been hampered by the 20 percent foreign currency surrender, as well as the thirty (30) days liquidation period.

“We are in the process of completing mock-up rooms for Hwange Safari Lodge and The Victoria Falls Hotel, the roll-out of which is expected in the first quarter of 2020,” the hotelier said.

Further, the group envisages the immediate launch of a new product known as “glamping”, an exercise reportedly understood to be the transformation of standard campsites into high end ones with a luxurious feel.  The product, which is anticipated to boost foreign arrivals, shall jointly be launched with the refurbished Great Zimbabwe Hotel.

“In the quest to broaden our reach, the group added high end Camp Sites at Great Zimbabwe Hotel and Caribbea Bay Resort in the third quarter. This new product, known as “glamping”, because of the more luxurious feel compared to a standard campsite, has already hosted the maiden group of guests at Caribbea Bay Resort in October 2019.

“The market is excited about this new development and we anticipate an increase in foreign arrivals at these properties as we go into 2020. An official launch of this product will be announced to the market soon and this will include a completed Great Zimbabwe Hotel refurbishment,” said the management.

Meanwhile, African Sun recorded a drop in occupancy levels for both its local and international markets owing to “January protests and low disposable incomes” on one hand, and “general slowdown in world travel by 3 percent” on the other, coupled with “civil unrest like the Hong Kong strikes that affected arrivals”.

Year-to-date occupancy levels dropped by 11-percentage points to 47 percent from 58 percent recorded in the same nine-month period last year.

This represented a 19 percent drop in room nights sold to 206 454 from 253 661 in 2018 comparative period. Domestic and export room nights reduced by 20 percent and 26 percent respectively.

Occupancy levels for the third quarter had declined by 24 percentage points to close at 51 percent from 75 percent in the comparative prior quarter. The fall represented 32 percent decline in room nights sold to 73 929 compared to 108 448 in the 2018 comparable quarter.

Business mix for the third quarter with regards to room nights was 59 percent local and 41 percent export. The revenue split (in historical terms) for local and export for the same quarter was 46 percent and 54 percent respectively.

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