Africa -  South Africa - Johannesburg

South Africa remains a key trading partner for European and Asian countries, has comparatively low taxes, a clearly defined taxation system and a clearly regulated market for income investors. Following two quarters of negative growth, the South African economy expanded by 2.5% q-o-q and 2.0% q-o-q during the second and third quarters of 2017, respectively. The central bank reduced the prime interest rate by 25 basis points to 10.25% during July 2017, citing an improved inflation outlook, a faster-than-expected moderation in food inflation, continued subdued domestic demand and resilience in the exchange rate. Since then the prime interest rate dropped to 10% in March 2018 as the Rand reacted positively to recent political developments and the recent ratings announcement by Moody’s.

The improved outlook for the coming years is based on a recovery from the 2015-2017 drought, stronger mining production, and improvement in the country’s political dynamics. Cyril Ramaphosa was sworn in on the 18th February 2018 after former president Jacob Zuma was recalled by the ruling African National Congress (ANC) party. Ramaphosa, who was elected president of the ANC in December by a slim majority, has already begun changes to revitalize the South African economy which had been in decline under Zuma.

Johannesburg’s international airport O.R. Tambo remains Africa’s largest and busiest airport with a total of over 21 million passengers in the financial year of 2017/2018, which represents a slight decline to the financial year before. In contrast, occupancy has shown a continuous growth and is the highest it has been since 2009 in Sandton and the surrounding hotels.

This year, HVI changed focus from the whole of Johannesburg to Sandton and surroundings as these are the key markets to both business and leisure guests. Room nights sold increased by 7% during the high season of 2017/2018 and RevPAR is expected to climb in 2018 and then stagnate in 2019 and 2020 due to a slight increase in new hotel supply. Rosebank is a fast-emerging area in Johannesburg with vibrant commercial, residential and retail developments. New hotel openings for 2021 include the Marriott Johannesburg Melrose Arch, the Marriott Executive Apartments Johannesburg Melrose Arch, which will add 350 rooms to the city’s supply in 2018.

Exchange Rate:

Exchange Rate 2016 Exchange Rate 2017 Change 2016/2017 Exchange Rate 2018 Change 2017/2018
US$ 1 0 0
South Africa - Johannesburg 0.06812 0.07511 10.3% 0.08103 7.9%

Change In Value For Market:

Legend
Significant Value Increase: Greater than +10%
Moderate Value Increase: Between +3% and +10%
Stable Values: Between -3% and +3%
Moderate Value Decline: Between -3% and -10%
Significant Value Decline: Less than -10%

South Africa - Johannesburg RevPAR Change

South Africa - Johannesburg RevPAR

Year RevPAR
2015 64.91
2016 64.56
2017 70.06
2018 (f) 74.20
2019 (f) 76.79
2020 (f) 79.37

For more information, please contact:

Tim Smith, MRICS
[email protected]
  • +27 797 342296 (w)
Rishabh Thapar
[email protected]
  • +27 0 792790584 (m)
Laura Dutrieux
[email protected]