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Friday Apr 13, 2012

SA hotel occupancy rates up but still low

Average hotel occupancy rates continued to rise for the seventh consecutive month in February after a steep fall caused by an oversupply of rooms provided in time for the 2010 World Cup, according to the latest South African Hotel Review Report issued this week.

But the figures, based on information from the main hotel groups, show that although there was a rise in every province except Limpopo, where rates fell to 52.9 percent from 60 percent in February last year and the North West Province, where these fell to 57.6 percent from 57.8 percent, occupancy was still low in most of South Africa with Durban and its surroundings reporting rates of 48.7 percent, slightly up from 46.9 percent.

But Umhlanga reported average occupancy rates of 57.5 percent, up from 52.7 percent in the same month a year earlier.

In Gauteng, the average occupancy rate rose to 62 percent compared with 56.3 percent, with the rate for Sandton and its surroundings the highest in the province at 64.8 percent, up from 60.5 percent. The rate for four star hotels in Sandton rose to 70.1 percent from 66.3 percent and for five star hotels to 63.5 percent from 57.5 percent.

Occupancies in the Western Cape - the main destination for overseas tourists at the high point of the season - were the highest at an average of 73.3 percent for the province compared with 71.7 percent a year earlier with the Winelands averaging 74.5 percent and Cape Town 74.2 percent.

Occupancy of five-star hotels in Cape Town rose to 75.8 percent from 70 percent, while that of four-star hotels was slightly lower at 73 percent compared with 74.5 percent a year earlier.

Bryan Mulliner, the strategic development and revenue director of the Protea Hospitality Group, said that this was because most five-star hotels in the city had reduced their rates to a level at which there was little difference between them and four-star hotels, causing some guests to pay a little more for increased luxury.

He said that hotels countrywide were struggling with higher costs, particularly for electricity and staff salaries and wages, while the number of visitors from key markets in Europe who stayed in hotels rather than with family and friends were fewer than before the recession.

In this situation, he emphasised, it was particularly important to offer value for money to tempt visitors to come here despite the high cost of long haul flights including taxes.

Business Report

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