The African continent remains the world’s youngest, with around 60% of its population under 25, a strong demographic for future travel demand. Despite this potential, most hotel markets are still relatively nascent compared to global benchmarks, leaving room for growth across leisure markets, secondary destinations and value-focused business markets.

The HVI covers 14 key African submarkets, which delivered an average RevPAR of about USD 99 in 2019. The 2025 average RevPAR is projected at USD 110, reflecting growth of 11% over the last six years.

Growth reflects both strengths and constraints. Domestic and intra-African tourism is gaining traction, providing steadier demand, independent of long-haul travel. Yet many markets remain reliant on international inbound tourism, especially at the upper end, due to limited regional airline networks, small hotel portfolios and underdeveloped infrastructure.

From a supply perspective, the outlook is encouraging. Africa has 577 hotels (104,444 rooms) in the development pipeline, up over 13% year-on-year, signaling confidence among brands and investors. However, converting these pipelines into operating hotels faces delays due to capital structuring, regulatory environments, and not enough backing or credibility from local partnerships.

Access to financing remains a structural challenge. While some lenders pressure owners to deleverage, this opens acquisition and development opportunities for private equity and high net-worth investors. Distressed or underutilized assets can often be recast with new operating models.

Overall, the outlook for African hospitality is cautiously optimistic. The demographic dividend, rising intra-regional connectivity and strong development pipelines, support sector expansion. Execution challenges, including financing, infrastructure, regulatory environments and rollout speed, will determine which markets outperform and how quickly capital generates value.

Hotel values across 15 key African markets have increased by an average of 13% in 2025 compared to 2019, reflecting cautious optimism and strengthening investor confidence, though performance varies significantly across regions.

West and East African cities lead the gains:

• Dar es Salaam (57%) Accra (+39%) and Nairobi (+15%) record solid growth, driven by corporate and leisure travel recovery and limited supply growth.
• Zanzibar (+36%) reflect rising visibility, brand penetration, and a diversified international and regional source markets.
• Lagos (+14%) has grown consistently on the back of solid corporate demand and limited supply growth, resilient amid economic and political volatility.
• Addis Ababa (0%) remains largely flat. Value stagnation indicates rising supply has outpaced demand growth, placing downward pressure on average room rates.

Southern Africa and the Indian Ocean islands show mixed outcomes:

• Cape Town (+49%) benefits from strong international leisure demand, higher ADR, and recovering corporate travel.
• Mauritius (+13%) and Seychelles (+6%) show steady growth, supported by resilient tourism and stable rates.
• Lusaka (+1%) achieved marginal growth of the back of strong tourism recovery, amid declining average rates. Johannesburg (-10%), and Windhoek (-4%) underperform compared to the rest of the regional market.

Key takeaways:

• Leisure-focused destinations - and those with diversified demand bases, including strong international market penetration - continue to outperform, driving ADR-led value gains.
• Corporate markets and smaller regional markets face structural and macroeconomic constraints.
• Overall, select African markets demonstrate resilience and selective growth potential, highlighting opportunities for investors and operators targeting high-demand leisure and business hubs and developing destinations.

Historical Trend - Markets in Africa (USD Value per Key in 2018, 2019 and 2025)

Leading and Trailing Markets in Africa (USD Value per Key in 2025)

Leading and Trailing Markets in Africa (% Value Change in 2025 over 2019)