Hotel rooms grow 37%

The number of hotel rooms in Rwanda has quadrupled in the last five years, with 416 rooms in nine new hotels expected by the end of 2008.

The number of hotel rooms in Rwanda has quadrupled in the last five years, with 416 rooms in nine new hotels expected by the end of 2008.

According to the Rwanda Office of Tourism and National Parks (ORTPN), there were 651 rooms available in 2003 and the number has increased to 3282 this year.

Within the last year alone, the number of hotel rooms has grown 37 per cent and has contributed positively to Rwanda’s economy, said Francis Gatare, director general of the Rwanda Investment and Export Promotion Agency.

“There’s no question about that,” he said, adding that tourism is one of the fastest growing sectors in the country. “As more tourists come into Rwanda, appropriate accommodations is going to be key.”

Last year, the tourism industry brought in Frw43.6 billion for Rwanda, and it will only increase, Gatare said.
“More hotel rooms are going to be increasingly important for this sector to grow and this already is showing an impact,” he told The New Times last Thursday.

“Recently we had our East African Investment conference which attracted over 1,000 people, approximately 800 from outside Rwanda alone, and they put a lot of pressure on the hotel capacity of this city of Kigali. We feel that unless our business community continues to expand, we cannot have a strong growth in this sector which has a huge potential. So the developments that you’re seeing in the hotel sector are very welcome and will continue to grow in the next five to six years.”

According to the Rwanda Private Sector Federation’s 2007 annual report, “wholesale retail trade, restaurants and hotels combined registered a 9.1 per cent annual growth.”

Rwanda received 408,482 total visitors in 2007, a 3.4 per cent increase from the previous year, ORTPN said in an Aug. 4 press release.

This number included leisure tourists as well as “all business visitors, visitors to friends and relatives as well as transit” and people traveling into Rwanda for all other purposes.

ORTPN director general Rosette Rugamba said in the press release that she expects the total tourism revenue to increase to Frw80.7 billion.

Frank Murangwa, ORTPN’s tourism inspection officer in charge of infrastructure, agreed that hotel growth was one of the most important factors to increase tourism and added that it would also increase employment.

Although Murangwa said he did not have the exact statistic for the expected employment growth, he said 2,500 Rwandans were directly employed in the hotel and tourism industry last year.

Gatare also pointed to hotel growth’s impact on employment as a positive outcome. “Hotels tend to be labour intensive. No matter how sophisticated they are, at the end of the day they are customer oriented businesses and so they tend to have the highest impact on employment and there’s no question about that.”

Murangwa said the government is still working on attracting hotel investors to the country because there was not enough accommodations previously.

“We want more people to invest in the sector now that we have higher standards that will help them put up hotels to increase the economy of the country,” he said.

Most of the nine new hotels are “high end,” Murangwa said, adding that the city of Kigali needed a five-star hotel. Currently, the only five-star hotel is the Serena, which is catered for diplomats and international business people.

Both international corporations and local business people are investing in the hotel sector, Gatare said, as local hotel owners expand their business while international ones look to partner with some of them.

“Take for example, Hotel Gorillas. Now they’re expanding with three extra hotels. They started with one hotel in Kiyovu and now this year they’re going to finish three new hotels, one in Nyarutarama, another one in Musanze and the third one in Ruafu,” he said.

“But in addition, we have international businesses like Dubai World also coming in to start new hotels. We have others including Lap Green which is partnering with local investors to do the international conference centre and hotels, so the interest is actually quite broad.”

Despite the significant growth in the hotel industry, Murangwa said there needs to be more to accommodate the growing tourism sector, however he could not say how much. “It’s difficult to answer,” he said.

“As time goes on, there are more tourists, so I can’t say specifically the number of hotels we would be happy with.”  Meanwhile, Gatare said he had no doubt that the demand for hotel rooms justified the quick growth.

He noted that there is an average of 80 per cent occupancy rate in all hotel categories on any give day in Rwanda. “This is very high by international standards. Most hotels if they have 70 per cent occupancy they are very happy,” he said, adding that the hotel industry is one where demand drives supply.

For example, when international conference organizers book their subsequent conferences, one of the key factors is whether the city can accommodate the participants. “The first thing that influences their decision making process is how many hotel rooms are available, what categories of hotels?” Gatare said.

“So you can’t wait for visitors to come before you build because visitors will not come if there’s no room. But also, you have to make informed decisions. When you look at the trends, past, present and the projections for the future, the growth potential is huge. So I have no question about the occupancy of any hotels built in this country in the next five to 10 years. We’ll continue to have many people coming to Rwanda.”