SA remains one of the most underserved luxury hotel markets in Africa, according to the InterContinental Hotels Group (IHG), which has begun capitalising with plans to expand its footprint on the continent.
The global hospitality company said SA remained one of the biggest market opportunities on the continent for the group and several other international players, with Cape Town, Johannesburg and Durban seen as vastly underserved despite their strong tourism and business potential.
“These are beautiful cities that are underrated and underserved today,” IHG Hotels & Resorts IMEA MD Haitham Mattar said. “There is a lot of headroom for international brands to make their way into SA.”
The global hospitality group sees great potential in SA supported by rising domestic demand and the country’s strong tourism fundamentals, he said.
“The Sub-Saharan Africa, North Africa and obviously SA is very interesting for us in development, because of the huge unlocked potential we see across the continent, especially in SA, where we see an abundance of great natural assets, outdoor adventure, beach, sand, nature, food, wines, so gastronomic experiences, as well that are a great offering and a great value for money.”
IHG, which operates brands such as InterContinental, Holiday Inn and voco, operates eight hotels locally and 38 across the continent, with 35 more in the pipeline.
The new developments are expected to add more than 6,500 hotel rooms in the next two to three years. In SA specifically, the group is in discussions to open between three to five additional properties and is also exploring deals in Namibia.
The group does not own hotel properties but partners with “high net worth” real estate developers and investors, offering global brand support, systems, loyalty platforms and management services.
A key part of the group’s local strategy includes the relaunch of the InterContinental Table Bay Hotel in Cape Town, scheduled to reopen in December after renovations.
The hotel, owned by the V&A Waterfront, will be operated by Sun International under a franchise agreement. Mattar said the relaunch was driven by demand for international brand standards among post-Covid-19 travellers.
SA’s appeal lies in its diverse tourism offering, from beaches and wildlife to gastronomy, wine and adventure travel. Mattar said this, combined with strong value for money, makes the country attractive for both leisure and business travel.
Statista projects that Africa’s travel & tourism market will generate $25.16bn in 2025, growing at 7.45% annually to reach $33.54bn by 2029. SA remains a key player, with its market expected to reach $2.53bn in 2025 and grow to $3.19bn by 2029. Hotels are projected to contribute $1.21bn in 2025.
Mattar said IHG was also targeting future growth in West and North Africa, including French-speaking markets with strong trade links. He said this region and SA, will be a major focus over the next decade.
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