Kenya and Tanzania will have about 3,000 more hotel rooms by 2020, when ongoing development of new hotels in the two countries are completed.

According to PricewaterhouseCoopers (PwC) in its, PwC Hotel Outlook 2016-2020, report hotel rooms in Kenya will increase from 18,100 in 2015 to 20,700 while six hotels are set to open in Tanzania, adding 600 rooms over the same period.

Hyatt Regency and Best Western are among the major chains contributing to the increase of hotel rooms in Tanzania.

Tanzania’s average room rate is set to increase from $139 in 2015 to $206 in 2020. Total room revenue is projected to rise from $222 million in 2015 to $371 million in 2020. Hotel occupancy will go up to 59.3 per cent in 2020 from 56.9 per cent in 2015.

Surge in room rates

PwC southern Africa hospitality industry leader Pietro Calicchio said early returns in 2016 projected a 19.4 per cent surge in room rates.

“We do not believe such increases can be sustained and project growth to moderate to mid-single-digit gains beginning in 2017,” he said.

For Kenya, the report said 16 hotels will be constructed in the next five years. Economic growth will play a big role in attracting new hotel developers, business travellers, domestic and foreign tourists.

“Kenya’s economic growth trend is currently robust and planned hotel investment is a sign of confidence with a rising middle class, urbanisation and devolution,” says the PwC report.

The hotel developments will add 2,900 rooms and expand capacity in Kenya by 14 per cent. International hotel companies that have already expressed interest in the Kenyan market include Marriott, Ramada, Hilton Garden Inn, Mövenpick Hotel and Four Points by Sheraton.

READ: Global luxury hotel brands eye East Africa market

Kenya continues to attract many investors due to its construction industry, access to the port of Mombasa and skilled workforce.